Posted: June 01, 2012
50 Colorado Companies to Watch 2012
Fueling the economic fireBy Mike Cote
The fourth class of Colorado Companies to Watch shares a few common traits with the program’s alumni: They’re successful, they’re growing and, chances are, you might be hearing about many of them for the first time. (See the list of winners and more details here, here, here and here).
That seems to be the story for second-stage companies. Overdue for respect and recognition.
They’re more than worthy. From 2008 through 2011, these companies generated $964 million in revenue and added 902 employees (both in Colorado and out of state), reflecting a 103 percent increase in revenue and 102 percent increase in jobs for the four-year period, according to information compiled by the Edward Lowe Foundation, which created the program. That translates into a 30 percent annual revenue growth and 27 percent annual growth in employees.
Those kinds of numbers have helped spur continued interest in the program – a collaboration between the foundation, the Colorado Office of Economic Development and International Trade and public and private economic development groups, associations and service providers throughout the state.
Colorado has become one of the "shining star examples" of how to conduct the program, says Penny Lewandowski, director of entrepreneurship development at the Edward Lowe Foundation, which also oversees Companies to Watch programs in
several other states.
"It has given this wonderful venue for commercial service providers, nonprofits, government – all working collaboratively to find, recognize and celebrate second-stage companies," Lewandowski says. "That’s one of the things that has made the program so incredibly successful – that collaboration that is literally all over the state."
This year’s 50 Colorado Companies to Watch winners are projecting continued growth in 2012, with a 47 percent revenue increase and 34 percent growth in employees (both in Colorado and out of state) compared to 2011. If those projections hold, these companies will have generated $1.5 billion in revenue and added 1,509 employees over the last five years – a 199 percent increase in revenue and 171 percent increase in jobs since 2008.
"Second-stage companies are an important component in Colorado’s economy and a significant driver of job growth," said Ken Lund, executive director of the Colorado Office of Economic Development and International Trade. "These companies account for nearly 39 percent of the state’s economy in terms of sales and are responsible for 34 percent of all of the jobs created."
Recognizing and celebrating the impact of these companies represents a major step toward ensuring the state creates the proper environment for them to succeed. Second-stage companies are looking for something more than business planning and marketing assistance. And they tend to move fast, Lewandowski says.
"They need much more sophisticated help, services that deliver pertinent information and guidance can play an incredible role," Lewandowski says. "They tend to learn from their peers. That’s where they feel there are trusted sources. Activities that are peer-to-peer are very important them."
Executives in these companies often are facing leadership issues that come with leaping to the next stage, Lewandowski says. "They start to look at management in a very different way because the entrepreneur can no longer be the person that takes care of everything at this company. Their growth issues and their strategy issues are very different than at early stage."
Each year, the state Office of Economic Development and International Trade works with a judging panel comprised of leaders in public and private sectors spanning business, government, education and associations from across the state. Companies that make the cut must be privately held, based in Colorado, employ six to 99 full-time equivalent employees and have $750,000 to $50 million in sales or a similar range of working capital. And, perhaps most importantly, they must be grappling with growth, not struggling for survival.
In addition to reviewing bottom-line information, the judging panel also considers company culture and impact on the community. "In this year’s class some of the philanthropic efforts were significant. That’s one of the things that really stands out," Lewandowski said.
A couple of examples: AppliedTrust, a Boulder-based information technology consulting firm, donated 2 percent of its pretax profits to nonprofit groups; workers with Gateway Products, an animal products company in Holly, volunteered to help refurbish a local community theater.
That sense of community connectedness fits the overall theme of the program, which requires multiple public and private groups to come together for a common cause to promote a year-round program that stretches beyond the annual June awards gala.
"When it comes to Companies to Watch – whether it’s organizers, service providers, the economic development folks, the press, the government – everybody is on the same page because they are already beginning to realize the incredible impact these companies have, particularly on jobs," Lewandowski says. "I think you’re really seeing that in Colorado. It’s easier to get people on board. It’s becoming natural."
2012 Colorado Companies to Watch Gala Dinner and Awards Ceremony
Friday, June 22
5 p.m. registration and welcome reception
6:30 p.m. dinner and awards
Denver Marriott City Center; 1701 California St.
Individual tickets: $135 • Corporate table of 10: $1,100
The Marriott is offering a special room rate (see link in event registration on website)
Mike Cote is the former editor of ColoradoBiz. E-mail him at firstname.lastname@example.org.