When pitching a company, entrepreneurs often have to balance optimism with credibility, and the beam is never thinner than when it comes to sales growth projections. How steep sharp should you make that hockey stick angle?
In a recent Vator status update, Marc Evans points to an interactive graph of the top 100 tech companies’ revenue over time, posted by Christian Chabot last week. I’ve embedded it below.
There are all kinds of stories to cull from this. Chabot notes while biz plans often project something like $100 million within 5 years, only 28% of the nation’s most successful public software empires were “rocketships,” ie, companies that reached $50 million in annual sales in 6 years or less. Microsoft took 8 years, Oracle took 10.
I played around a bit, and noticed that of the 7 entertainment companies all of them were either rocketships or hot (ie, no “slow burners”). The #2 company in this category, and most recently founded of all 100 titans, is China Digital TV Holding CO., Ltd—a testament to the benefits of being anointed the official Chinese anything. The next most recent entertainment company, DivX, founded in 2000, took 7 years to get to $50 million.
Interestingly, all of the companies founded since 2000—namely DivX, Netezza, Sourcefire, and SuccessFactors (I’m not counting the Chinese anomaly)—took 7 to 8 years to reach $50 million. NO rocketships in the last decade.
Play around and let me know if you notice any other interesting patterns.
