While an economic downturn was challenging for most businesses, this year’s community of the fastest-growing companies in B.C. proves that it did not prevent entrepreneurial expansion. If anything, it spurred it on.
As in the past two years since we started publishing the top 100 fastest-growing companies, every B.C. company on this year’s list reported at least a doubling of revenue in the five-year period between fiscal 2005 and 2009.
This year, to further highlight the entrepreneurial drive of B.C.’s business community, BIV has expanded yet again the list of fastest-growing companies, to include the “Next 50” fastest growing companies, coming out in next week’s issue.
The expanded look provides some unique business intelligence. The most notable is the distribution of growth across various sectors. Of the 150 companies reporting growth of at least 50% between fiscal 2005 and 2009, nearly a third are service-related, with 43% of them growing by at least 50%.
While product revenue has been a key driver of revenue growth for technology and mining companies on the list, the increased proportion of service companies suggests that many are providing the right quality of service to attract and retain customers to rapidly grow their business, in addition to being innovative and providing something in high demand.
The technology sector, however, retains its dominance on the list. Of the 54 technology companies comprising the top 150 fastest-growing companies in B.C., 81% of them have more than doubled their revenue in the past five years. While 22% saw revenue increase between 100% and 200%, nearly a third have revenue rising between 200% and 500%. About 15% of the fastest-growing tech companies have revenue jumping by more than 500%, and 9% have revenue increasing by more than 1,000%.
Of the six broad sectors represented on this year’s list, only mining, technology and service-type companies reported revenue growth greater than 500% in the past five years.
Mining and technology companies continue to rank highly on the list. Over the past 16 years in which Business in Vancouver has published a list of B.C.’s fastest-growing companies, those two sectors have constantly vied for top spot. This year’s list, the 17th in the paper’s history, has not broken the trend, with Aurizon Mines Ltd. (TSX:ARZ) topping the chart.
Something unique about this year’s results is the fact that mining companies dominated the top ranks of the list, filling five of the top 10 spots this year, whereas in previous years the top tiers were more evenly distributed among different sectors.
Last year, BIV received information from 160 companies that reported at least 50% growth in revenue between 2004 and 2008, with 105 of those doubling revenue within that five-year period. The number of submissions this year is little changed, with 150 submissions by companies reporting at least 50% revenue growth between 2005 and 2009 and 103 doubling revenue in that period.
While growth is important, so is profitability, and on this front, the majority of B.C.’s fastest growing are also in the black. Of the 130 that disclosed profitability information, 62% said they were profitable last year, a significant number given the common challenge of making money while also growing a business.
Going forward, it will be worthy to note the impact the HST will have on many of B.C.’s rapidly growing companies. Some companies already started dealing with the issue even before the tax came into effect. Houston Landscapes’ Jeremy Miller noted he started taking the HST into account for any project he was bidding for that started after July 1, 2010.
“I was already discounting my material prices by 7% by simply removing the fact I didn’t have to pill PST. Usually my projects are 40% labour, 60% material, so my overall bid price was coming down by about 4%.”
Some others may not be so fortunate.