A Small Business Can Be A Highly Profitable Company

Asked to clarify the difference between a small business and a scalable business that hopes to earn a billion dollars, David Heinemeier Hansson, partner at 37signals, says they are the same thing. Scalable for Heinemeier Hansson means there isn't a direct correlation between profit and employee count. Many large companies give the impressions that there is a connection - i.e., for every $500,000 earned, a company must hire two people - so smaller companies wrongly focus on organizational charts and meetings. He points out that 37signals is both a small business (15 employees) and a highly profitable company.

Provided by: Stanford University Topic: SMBs Date Added: Jan 2010 Format: Webcast

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