State has 58 of nation’s fastest-growing companies

By Jennifer Coleman The Associated Press
Wednesday October 16, 2002

SACRAMENTO – More of the fastest-growing businesses, as ranked by Inc. Magazine, are from California than from any other state, negating an impression the state’s business climate is too unfriendly, state officials said. 

“Three of the top 10 fastest-growing companies in America are in California, and 58 of the top 500 are in California, substantially more than any other state,” said Gov. Gray Davis. “And even though we’re dealing with a national recession, California has maintained policies that promote growth and encourage innovation.” 

Of the 58 California companies that made the list, 23 were from the Bay Area, 17 were from Los Angeles and 11 were from San Diego. 

Texas had the next highest number of companies on the list, with 47 firms. Florida had 31 companies and New York had 28. 

The magazine ranked Outsource Group of Walnut Creek, Calif., as the nation’s fastest-growing company. Outsource, which provides professional personnel services to businesses, grew 54,330 percent in five years, with sales of $294.5 million in 2001. 

Inc. Magazine will release its list at the end of October. This is the second year that California, the nation’s most populous state, ranked first on this list. 

The state’s good showing also is contrary to the impression that California’s economy was “incredibly dependent on a smoke and mirrors, dot-com economy,” said Karen Dillon, executive editor of Inc. Magazine. “This is good evidence that there’s a lot more breadth and depth” to the state’s economy. 

California, with the fifth largest economy in the world, has a gross state product of $1.4 trillion. 

The 500 companies on the magazine’s list had an average five-year sales growth of 1,521 percent. The average figure for last year’s list was 1,933 percent. 

Average sales for the top 500 companies dropped slightly, from $24.9 million to $24.7 million, Dillon said. The technology sector remains the leading industry, with 40 percent of the firms.