Putting Perspective on Success

Last week we were recognized as the 20th Fastest Growing Small Business (sub $2 mil in revenue) by the Mercury 100 for Boulder & Broomfield Counties here in Colorado. On the surface this might seem like a great accomplishment, however it’s a false measure of success, and I’ll tell you why.

• The Mercury 100 just looks at Boulder / Broomfield County. Not Denver or the rest of the state. Colorado is loaded with great startup companies. Sure, Boulder & Broomfield are a hotbed of entrepreneurial activity, yet sizing yourself up against a small group isn’t a true validation of efforts.
• You have to apply to be in the Mercury 100. Who knows for certain how many small business out there have not submitted their information. Clearly if you’ve found wild success in a business model why, other then selling the business or gaining investor dollars, would you feel the need to tell others?
• The growth is skewed as a startup. It’s not difficult to show 500% growth when your first year consisted of the 3 months in ‘06 followed by a ramp up in ‘07 and sustained business in ‘08.
• Revenue growth doesn’t equal profitability. While our revenue has grown over the last few years our most profitable year was ‘06. Arguably we’ve become less efficient as a business, and that is certainly not a measure of success.

So why are we rewarding pure revenue growth?

Don’t get me wrong, I like the recognition we receive for things like this. I just want to stress to other business owners that measuring success by pure revenue growth clearly isn’t the best option.