This blog first appeared on Virgin Entrepreneur on 3 July 2015.
Over the last year we have met and interviewed several dozen founders and CEOs, the leaders behind some of the world’s most innovative and pioneering companies. Our question: what makes the best in business stand out today, in a market more competitive, crowded and demanding than perhaps ever before?
The answers are captured in our new book Mission: How the Best in Business Break Through. What we learned, speaking to the founders and past and present leaders of companies ranging from Whole Foods to Ella’s Kitchen, Marks & Spencer to Tesco, and Airbnb to Dyson, is that profit alone is no longer enough for a company to succeed. It is purpose, a driving mission to change things for the better, that defines the real winners.
Why? Put simply, the environment for business has changed, and the expectations on companies – from employees, customers, investors and observers – are much greater. Today’s world is information rich but attention poor: people struggle to keep up with the bombardment of advertising messages, but at the same time, they expect more of the brands they buy from. Millennials, the twenty and thirty somethings who are coming to dominate both the employment and consumer markets, are significantly more likely to believe that the brands they consume reflect their values. By 2025, they will make up three quarters of the workforce.
According to research from Havas, consumers would not care if as many as 74 per cent of brands disappeared tomorrow. Becoming a business with purpose, one that resonates with its customers for reasons beyond product and price, is a crucial ingredient to ensure that you are one of the 26 per cent that people will care about.
In the view of John Mackey, the founder of ethical grocer Whole Foods, who we interviewed for Mission: “Humans are evolving; we want to have more purpose, we want our lives to make a difference, we want to work for businesses that are more creative, and we like to think that our creativity is motivating other people.”
As the expectations of consumers ratchet up, the world of business is itself transforming, at high speed. In the UK alone over the last five years, over 760,000 businesses have been created. And, as the rate of business formations surges, so too is the pace of company growth accelerating. Last year, the Wall Street Journal began tracking the world’s population of ‘unicorns’, the start-ups valued by investors at over a billion dollars. In January 2014, the total number was 42; since then it has more than doubled, to a round 100.
It is now easier than ever to start a business and, moreover, to grow to global scale in record time. Companies whose stories we tell in Mission, like Airbnb and Uber, have become international, multi-billion dollar success stories in well under a decade. A British example, Ella’s Kitchen, was founded in 2006 and last year became the market leader in baby food products, a start-up.
All three are, in very different ways, mission-driven companies. Ella’s Kitchen wants to change children’s relationship with food, and address the childhood obesity and malnutrition crises the UK faces. Airbnb, co-founder Joe Gebbia told us, is working to change the experience of travel and allow people to find a home anywhere in the world.
Uber, highly controversial as well as successful, is driven by its stated mission to provide “transportation as reliable as running water, everywhere, for everyone”. Its founder, Travis Kalanick, has said he believes Uber can ease congestion in London by taking a million cars off the city’s roads through its ridesharing service.
These companies epitomise the new categories of business we believe to be emerging: the carers, companies who want to improve people’s lives; sharers, taking advantage of the unprecedented networks the Internet has created; and darers, the technological phenomena who refuse to take no for an answer. These are the companies that are changing the world, and the way people live their lives; and it is that purpose which defines and motivates them.
Most excitingly of all, the best may lie ahead. It is estimated that two thirds of the companies who will make up the S&P 500 in a decade’s time have not yet launched. The companies that are going to change your life, are probably not just those you haven’t heard of, but those yet even to be created.
Photo credit: go.reverieinc.com