A lot of successful entrepreneurs will tell you there’s never a bad time to start a business. There’s great inspiration in that aphorism, but it would be helpful to popularize this alternative: there’s never a bad time to start a good business. Sure, timing can hurt a startup, but well-built companies with attractive products and smart, motivated employees can survive the vagaries of Father Time.
This year’s PROFIT HOT 50 are a testament to that. Founded in 2006 and 2007, all the firms on our 11th annual ranking of Canada’s Emerging Growth Companies overcame the typical challenges of the startup phase even as they confronted the Great Recession—which still lurks in the rear view mirror. And they put an exclamation point on these achievements: HOT 50 firms averaged revenue growth of 548% over the past two years, with the vast majority of them turning a profit in 2009—an amazing achievement for young companies in a harsh economy.
What makes them different from the majority of new businesses, which don’t live to celebrate their fifth birthday? Well, they’re well-built companies with attractive products and smart, motivated employees. How did they get that way? HOT 50 founders succeeded because they build scalability into their business plans, value good people as much as a good product, focus on niche markets, employ their personal networks and accelerate the development of the one thing most startups lack: credibility. You’ll find more on these strategies in “The 5 Essentials of Successful Startups,” which starts on page 35.
Clearly, these kids are alright. But what does the future hold for the next generation of startups—and Canadian enterprise in general? We sent veteran business journalist Brian Banks in search of the forces and trends that will pose the biggest threats to business over the next five to 10 years. His wide-ranging exploration informs an insightful piece (“How to Own the Future” on page 46) that identifies three daunting challenges for firms of all shapes and sizes:
- An era of slow economic growth, thanks to demographic shifts and the rising tide of foreign competition, among other factors;
- The demographics-induced return of the labour shortage, which is unlikely to be relieved by higher immigration quotas;
- Smarter, greener customers who know what they want—and know how to use technology to find it.
But Banks’s story also suggests that entrepreneurial firms will find solutions to these big problems—and exploit the opportunities within them. After all, there’s never a bad time to start a good business.