These Hot Firms Stay Ahead of the Pack

Rieva Lesonsky: What exactly is a Gazelle 2.0 company, and how many of them are there?

Spencer Tracy Jr. : A Gazelle 2.0 company is a rare species. Of the nearly 18 million businesses operating in the U.S. today, only 341,000 are Gazelle 2.0 companies. These are the 2% of businesses that generate on average a staggering 80% to 90% of all employment growth. Gazelles 2.0 are also industry innovators. They are the companies that spot unique market opportunities and move rapidly to exploit them. In the process, they revolutionize industries by creating entirely new ways of producing their products or services.

How does this generation of gazelles differ from those in the '90s?

There's a change in the average size of a gazelle firm. Eight years ago, the average gazelle company had about 55 employees; today, Gazelle 2.0 companies average about 47 employees.

Does any one industry dominate the Gazelle 2.0 companies?

Gazelles 2.0 are found in every industry. However, within specific periods, Gazelles 2.0 do tend to be found in the more active industries of that time period. For instance, during the dot-com boom, the highest percentage of gazelles was in high-tech. Today, the highest proportion is found in the petroleum industry.

What is one of the outstanding traits of Gazelle 2.0 companies?

Without reservation, their efficiency. Gazelle 2.0 companies generate far more revenue per employee. While non-Gazelle companies are also becoming more efficient, Gazelle 2.0 businesses have become far more efficient, with nearly 60% more revenue per employee than non-Gazelles.