I just don’t get it.
The Inc. 500|5000 has always been a source of curiosity to me. I love the idea of an independent, merit-based recognition for businesses. Inc’s brand represented quality of thought and diversity of skillsets, which placed in me a growing desire to build a business that was worthy of this award.
For the first time ever I looked into the Inc. 500|5000 today. Here’s what I saw:
Does my company have to be profitable to be eligible?
No. The Inc. 500|5000 is determined solely by revenue growth; profitability is not a consideration.
What the fuck?
This isn’t merit based at all. It all floats back to how much capital you have. Blow $10M on a start-up in year three and spiking that revenue growth chart would be cake. Get a bit more press, to get a bit more funding. Or start out well off and aim for wealthy.
Profit doesn’t matter to achieve Inc. 500|5000 acceptance, but it sure does for their parent company Mansueto Ventures. Joe Mansueto, a self-made billionaire, said to Chicago Magazine in 2006:
And you know, as a sixth grader to make $200 in a month, I was in heaven. I thought, Gee, this is easy. How you can buy something and sell it for more-I was just kind of amazed how that works.
For Mansueto, picking up Fast Company and Inc. for less than 10 percent of what Gruner & Jahr paid for them in 2000 isn’t much different from buying a ham radio receiver that’s on sale for a third of what it’s worth. Only this time, he didn’t have to borrow money from a friend’s dad to seal the deal.
My point is that Joe Mansueto aims for profit. The fact that he was able to build an empire from these small decisions, backed by less than $250k in bonds, is remarkable. But the skill of these talented actions are removed when you increase this initial capital to $1M, $10M, or $100M. More money equals more time to breathe, more failure, and more opportunity.
I want a true merit based award. One that recognizes starting with nothing, means something. And one that doesn’t blindly congratulate revenue, while ignoring profit.