In the Wall Street Journal, Scott Austin, writing for the Venture Capital Dispatch blog talked about how quickly tech companies grow – specifically, what makes a tech company a “rocket ship,” “hot company” or “slow burner.”
The difference being the answer to one simple question: “How long did it take the company to reach $50M worth of revenue?”
And it may take longer than you’d think – a lot of tech companies considered “fast growers” by human standards took 10 years – or longer – to reach that $50M mark. For example, Oracle reached $50M in 10 years – Microsoft in 8.
NetQoS – not mentioned in the WSJ article, took 9 years to pull off the same feat, a “hot company” by Austin’s standards. To qualify as a “rocket ship,” a tech company needs to reach $50M in 6 years – which include companies like Activision, Adobe, Autodesk, Blackboard, Cadence – well, actually, there’s a whole chart of themon the WSJ site, so it’s probably a good idea to look them up there.
Some tech industries promise quicker growth. Video game companies Activision, Electronic Arts, and Take Two are all “rocket ships,” network/infrastructure companies (like NetQoS) tend to hit right in that “hot company” area, and vertical applications companies tend to be slow burners (with notable exceptions like Blackboard and Intuit.)
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