Stuart R. Monroe
Entrepreneurial Education Foundation
Denver, CO 80231
The Premier FastTrac? (FT) programs have provided training to entrepreneurs who start and grow lifestyle ventures since 1986. As of 1997, there have been over 16,000 graduates from FT programs. In 1993, the Center for Entrepreneurship Leadership Inc., of the Ewing Marion Kauffman Foundation, funded dissemination of FT programs nationwide to service emerging and life-style entrepreneurs. The FT program was chosen because of its proven track record, proven effectiveness, and longitudinal research. The authors propose that proven entrepreneurial training programs significantly contribute to the growth and performance of emerging businesses.
Statistical analysis of 269 responses from a 1995 national survey of FT graduates, indicates FT training programs have a significant, positive impact on new venture gross sales, profitability, and employment. Also, correlation analysis revealed that FT entrepreneurial training was highly related to new venture performance. Segmenting the survey data on gross sales identified an unusually large clustering of high-growth ventures that were identified as "gazelles," using the term coined by David Birch in 1995.
Birch described the "gazelle" firm as one with at least 20% growth every year from 1990 to 1994 starting with a gross sales base of at least $100,000. Birch found that approximately 3% of the firms tracked between 1990 and 1994 fell into this category. Through our national sample of 269 FT graduates, it became evident that some graduates represent very high growth ventures that we have termed "FT super gazelles". A "FT super gazelle" is defined as an early stage company experiencing at least 100% increase in annual gross sales starting with a base of at least $50,000.
Due to the various criticisms in the field (Chandler, G. and Hanks, S., 1993) on the impact of training and the ability to measure training effectiveness, further empirical research was needed to support the previous findings with a specific focus on "FT super gazelles. The objective of this study was to identify a conceptual model of the common characteristics, strategies, and processes, essential for growing "super gazelles."
FT program administrators were asked to recommend graduates for our "super gazelle" study. These graduates were sent a cover letter and an application during Fall of 1996. All 29 graduates, who completed an application, were interviewed.
The research methodology uses the quasi-experimental design. The ex-post-facto performance data of the 29 "FT super gazelles" and personal telephone interviews with the firms principals was the basis for our statistical analysis. Each phone interview involved six separate content modules: 1) business description and environment, 2) the entrepreneur, 3) venture start-up, 4) sales and marketing, 5) financials, and 6) FT training. We are currently in the process of transcribing all taped interviews, coding the data, and conducting a content analysis using the software NUD-IST 3.
Aggregate data from 269 FT graduates indicates a statistically significant correlation between training and subsequent growth after training. For example, average gross sales increased 51.8% after FastTrac training. Recent interviews with FT super gazelles support our aggregate findings, and further explained the impact entrepreneurial training had on venture growth and hyper-performance. We are still in the process of analyzing all the data, but initial findings indicate that the "FT entrepreneurial tool kit" and the process of completing a FT business plan were the significant contributors to their growth. Also, initial results indicate that, as a result of FT training, the graduates: 1) narrowed their business focus and better defined their ventures; 2) established a solid growth plan; 3) increased their confidence in operating their business ; 4) established a network of contacts; and 5) began viewing their businesses from an investor/lender standpoint. Owner motivation, superior product/service, access to capital, and right place at right time (luck) were additional important variables. However, the comprehensive FT entrepreneurial training was the single most important key to moving the company forward to the next generation of growth.
The results of this study will provide insights and guidance to the field of entrepreneurship as to the importance, impact, and effectiveness of entrepreneurial training in growing life-style ventures. Public policy and economic development specialists should strongly consider funding proven entrepreneurial training as one of the major "jump-start" tools for their programs. Institutions of higher education should expand the scope and rigor of their entrepreneurship courses to students and their communities to support exploding small business activity. Other providers of small business training and technical assistance, such as chambers of commerce and community microenterprise lenders, should support proven and comprehensive entrepreneurial training to help expand high economic impact "FT super gazelle" firms.