Isn’t it better to grow slowly and retain control, than have all the headaches and risks associated with fast growth?

Many entrepreneurs believe that it is better to grow slowly and retain control, rather than trying to grow fast by raising money from investors, and thereby losing control. This may be true in some cases, but one has to consider the fact that most businesses don’t have the luxury of time.  While companies have the potential to have a long lifespan, most companies have a lifespan that is less than an average person. Even large companies are short-lived. For example, in 1917 Forbes published a list of the 100 largest American companies. By 1987, 61 had ceased to exist. Similarly, as Dick Foster points out in Creative Destruction, “Of the five hundred companies originally making up the S&P 500 in 1957, only seventy-four remained on the list through 1997. ”

The average life expectancy of a multinational corporation is between 40 and 50 years (see The Living Company,  Arie de Geus, Harvard Business Press).  A recent study by Ellen de Rooij of the Stratix Group in Amsterdam indicates that the average life expectancy of all firms, regardless of size, measured in Japan and much of Europe, is only 12.5 years.

Given the short life span of most companies, most entrepreneurs who choose to grow slowly find that their company is no longer viable because it has been overtaken by new technologies or competitors whose higher levels of growth make them more competitive. These entrepreneurs might be better off pursuing growth than control.

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