Software Pulse

Business Strategy for Software Executives

March 27, 2006

David G. Thomson

Blueprint to a Billion

A study of billion-dollar companies identifies seven essentials for turning a breakthrough innovation into exponential growth.

By David G. Thomson

Microsoft, Oracle, BEA, Google, Symantec along with many examples in other industries such as Staples, Genentech, Starbucks and Nike are members of an elite group of companies that managed to turn breakthrough innovations into billion-dollar businesses. What did these and other high-growth companies do to achieve such a goal? What blueprint do they follow to produce such results?

It took three years of in-depth research to answer these questions. The result is the first quantitative assessment of the success pattern across a distinct group of 387 “Blueprint Companies” – the 5% that have IPO-ed since 1980 and grown to $1 billion revenue. They represent America’s highest growth companies: they achieved exponential revenue growth and returns.

What does it take to become a billion-dollar company? I realized the answer would not come from qualitative approaches focusing on innovation or organization lifecycles but from a quantitative and fact-based analysis of America’s high growth companies. I started my journey in the technology sector including the software industry but quickly found this common pattern across all industries. The analysis had to hinge on what is often overlooked: revenue performance. Every company can innovate and invest, even over-invest in order to grow. However, not every company can create stellar revenue growth.


Last Chance to Be a Part of Software 2006

Next week, more than 2,500 senior software executives and professionals will gather in Santa Clara. Calif. to discuss the key issues which will shape the next era of the software industry. Donít miss this one-of-a-kind event! Register now and review the latest speaker lineup at

Click here to register >>

Send Us Your Thoughts:
Unifying the Ecosystem

The theme of Software 2006 is ìUnifying the Ecosystem.î How can vendors, customers, investors, services firms, analysts and channel partners better work together to drive industry growth? Send us your thoughts to and weíll post the responses in a new Blog topic, Unifying the Ecosystem.

SOA-based Systems Headaches

In the old days, enterprise products had to integrate business processes across multiple organizations. Tony Baer describes the challenges services-oriented architectures (SOA) bring to the forefront - the health of underlying infrastructure and a need for improved governance ñ in this weekís post to the Blog on SOA.

A Hybrid Model for PR

Retainers may be going the way of perpetual licenses. George Schildge of Matrix Marketing Group says performance-based revenue models for public relations firms are moving quickly towards reality. Read more in this weekís post to the Blog on Sales & Marketing Best Practices.

New Podcast on Offshoring Best Practices

Sand Hill Group’s M.R. Rangaswami will discuss highlights from the new study on software vendor offshoring trends, and will be joined by product development experts to discuss the latest strategies, challenges and best practices. Click here to listen.

For a full replay of the offshoring Webinar including perspective from offshorers and vendors, visit

The Week in Review: Microsoft in Mudville

Every Friday, editors will bring together the most important news of the week. The inaugural Software News Summary looks back at a tough week for Microsoft, Ellisonís talk of subscriptions and more open source developments.

Spring rain dampened the end of a gloomy week in Redmond. By Friday, Microsoft had delayed not only the release of Vista, but also Office. Both are now slated for debut in 2007. Redmond also announced a shakeup of its Platform and Services Division, placing Steve Sinofsky in charge of Windows. Read this Software News Summary …

Poll: Is Office/Vista Delay a Good Thing?

Microsoft delayed release of both Vista and Office until early 2007. Is that a good move?
Take our Pulse Poll >>

Last week, readers gave their opinions about whether Sarbanes-Oxley regulations go too far.
Give us your opinion and see the results >>

On the Radar: Meet the Showcase Companies

The list of twenty fast-growth software companies exhibiting as part of the Software Showcase at Software 2006 might surprise you. Find out more about these innovative vendors in this weekís Radar profile.

More at

IEEE head questions expanding H-1B visa program.
Read the most important enterprise software industry news of the week >>

Proofpoint receives $20 million.
Monitor the latest software venture capital deals >>

Cadre Technologies buys LDS.
Size up last week's software M&A deals >>

Active Reasoning names William Winters as CEO.
See who's made it to the top in our list of recent software executive appointments >>

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Parting Thought

“Microsoft is not about greed. It's about innovation and fairness." – Bill Gates

Courtesy of Malcolm Kusher, The Kushner Group