Self-referential editorials — you know, the ones that tell you what’s in the issue and who contributed to it — are not accepted practice at this magazine. But this column will be an exception. After all, it says “Special Issue” right on the cover.
So, I’m going to answer a question I get all the time: how do you put the PROFIT 100 together? The query is not just an icebreaker used at business functions; in fact, it usually comes from entrepreneurs who want to be on the list, people who want to buy into Canada’s Fastest-Growing Companies, and the people who work for organizations that track and support economic development in Canada. It has even been posed by a few publications hoping to duplicate the feat in the region or industry they cover.
The best place to start the answer is to define what separates the P100, as we call it around the office, from most corporate rankings. Besides the uncommon focus on entrepreneurial business, the PROFIT 100 is built on proprietary information collected from primary sources rather than data from third parties. It allows us to get deep inside these companies and the heads of the people who run them. We spend six months on the research phase alone. It kicks off in December with the publication of an entry form in this magazine and online; the ranking is released and the leaders of Canada’s Fastest-Growing Companies assemble at the PROFIT 100 CEO Summit the following June. In between, we recruit an array of ballot distribution partners, from the big banks to business associations, to help us distribute thousands of entry forms. Once the ballots are in, our researchers spend hundreds of hours interviewing the leaders of the PROFIT 100 and Next 100 firms. The CEOs answer dozens of probing questions that reveal how these companies have achieved their phenomenal growth and what it takes to lead such companies.
Then come the financial statements, which are used to verify all of the revenue and net income figures published in the PROFIT 100 rankings. Convincing many of the private companies to part with their documents and reveal their figures to the world is an exercise in gentle persuasion and dogged persistence. Synthesizing the required numbers can be even tougher, as fiscal year-ends change over the five-year period measured, companies merge or firms change their accounting policies without restating their results.
One perennial task is reviewing the program’s metrics and qualification criteria. Every year, a few exciting young businesses with great growth stories challenge our definitions of “Canadian company,” “revenue” and “founding date,” among others. We run each case through some what-if scenarios, consider the outcomes with the PROFIT 100 mission in mind and make the necessary adjustments. It’s no way to spend your summer afternoons, but each improvement allows us to consider more candidates worthy of recognition and find out what they can teach other companies about doing business better.
The final product is the most comprehensive, authoritative and useful analysis of entrepreneurial Canadian businesses you’ll find anywhere, and it starts right here. That’s the real reason we call this a special issue.