L.A.-Area Firms Dominate List of Fast Starters

The Los Angeles metropolitan area outpaced the rest of the United States as an incubator of small businesses last year, nurturing more than one in 10 of the nation’s 100 fastest-growing small enterprises, a survey of Dun & Bradstreet data found.

A 72-employee clothing manufacturer in Chatsworth took top honors in the survey conducted for Entrepreneur magazine, logging a 3,300% jump in revenue in 1997.

Texas, with 12 companies on the list, surpassed the 11 from the greater Los Angeles area, including Ventura and Orange counties. But proportionally, the L.A. area beat out the more populous Lone Star State. In a sign of the strength of California’s economy, the state dominated the list with one-quarter of the companies.

Using Dun & Bradstreet’s database of 11 million U.S. businesses, the study measured the rate of a company’s sales growth since its inception. No businesses older than 3 years were surveyed, and all met the criteria of a small business in their industry as defined by the U.S. Small Business Administration.

News of the top award took the offices of John Paul Richard Inc., by surprise, Chief Financial Officer Ron Schwartz said Friday. “We would have been happy with 99th. When they told us we were No. 1, it was almost hard to believe. We were ecstatic. It’s a nice boost.”

Launched in May 1996, the maker of moderately priced women’s clothing attributes much of its success to the experience of its management team and the loyalty of deep-pocket customers that followed the company’s six top officers from their previous posts with other manufacturers. Each brought to the new venture at least 15 years of know-how in various aspects of the apparel industry, Schwartz said.

With a ready-made customer base that included heavy-hitting retailers such as Sears, Mervyn’s, J.C. Penney and Robinsons-May, company revenue grew from $1.4 million at the end of its first year to $45.7 million last year. And already this year, the company has notched $44 million in sales, Schwartz said.

“We’re on target to double what we did last year,” he said. “We started the company with a lot of experience, so we kind of hit the ground running.”

The state’s other fast starters, according to the survey, made their mark in a variety of industries, including organic foods, wine distribution, computers and high technology. The Bay Area was home to California’s second-largest hub of hot starts with seven, and Sacramento and San Diego County each had three.

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Growth Spurts

Southern companies made up 11% of the 100 fastest-growing small firms in the United States, according to a survey conducted for Entrepreneur magazine by Dun & Bradstreet.

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1997 sales Rank Company Headquarters in millions 1 John Paul Richard Chatsworth $45.7 12 Angel Produce Torrance 11.4 13 Digital System Technology Irwindale 10.1 15 Ariston Technologies Huntington Beach 9.9 23 H. Greenblatt Los Angeles 5.2 29 Apex Design Technology Anaheim 6.7 47 IXC Marketing Anaheim 3.3 48 Rankserve Newbury Park 3.3 56 Rehab Medical Santa Fe Springs 2.8 71 PathNet Institute Van Nuys 2.3 83 AMT Component Irvine 2.1

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