Back in 1981 David Birch asked, “Who creates jobs?”, an article that demystified the high-growth business market. While many years have passed, it is as relevant today as it was then. Out of his work came challenges to the myths of high-growth firms (HGFs) (that they are predominantly young, small, high-tech, VC-backed, university spin-outs, who grow in an orderly organic fashion, operating similarly irrespective of location).
Myth #1 High-Growth Firms are young and small Not always.
Myth #2 HGFs are high-tech Not always.
Myth #3 HGFs are VC-backed Only a tiny fraction, with the majority preferring to use their own funds or conventional debt-finance.
Myth #4 HGFs come from Universities Few university spin-outs grow and the majority remain very small.
Myth #5 HGFs grow steadily Growth is erratic, unpredictable, sporadic and often of limited duration.
Myth #6 HGFs grow organically They frequently grow thanks to acquisitions.
Myth #7 HGFs are the same irrespective of location Just compare the job creation activity in Scotland with London or the Home Counties.
Conclusion Gazelles are often viewed as a homogeneous group of small firms that are predominantly high-tech, university-derived and VC-backed. In reality, gazelles are a highly heterogeneous set of firms.