The Fortune 500: An old company's game

It's quite dated now, but someone in 1994 did a survey of the founding dates of the Fortune 500 companies as of that year, and found that new companies were quite uncommon: 39% were over 100 years old, and about 50% were founded between the 1880s and the 1920s, in the "second industrial revolution". Only 16% of F500 companies (as of 1994) were founded after 1950.

The authors speculate that the 1880s-1920s period dominates because it gave birth to the first large-scale corporations that could enter new markets, acquire new businesses, etc., through a mix of industrial and financial prowess. So while the Second Industrial Revolution gave rise to a bunch of F500 companies, the post-war Third Industrial Revolution based on chemicals, pharmaceuticals, aerospace, electronics, etc., hasn't given birth to as many new firms, because the older firms have been able to enter the market themselves, or buy up newcomers who do.

The exceptions they note: "companies such as Apple (1976), Compaq (1982) and McDonald's (1948), built new industries focusing especially on integrated-circuit technology and on franchising in the food and retailing sectors. Tellingly, the youngest member among the Fortune 500 is Office Depot (1986), one of the new breed of 'category killers' that have appeared in certain retail sectors. These category killers depend on sophisticated information technology for quick reporting of turnover figures and detailed data about their customers."

The article's here, but paywalled: http://www.jstor.org/pss/3117220

via _delirium on news.ycombinator.com

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