On September 4, 1921, my grandfather arrived in the United States, 17 years old, with just $25 in his pocket. He became a dressmaker, and in 1937 received a patent for what he called “a new, original, and ornamental design for a Dress Ensemble.” While my grandfather has been gone for many years, I recently asked my uncle about the patent. He claimed that the actress Elizabeth Taylor once wore the dress it describes in a photo shoot for Seventeen. In many ways, my grandfather was an innovator. He launched his own business, and thrived in the teeth of the Great Depression. But beyond our family, his impact was modest. His business closed when he retired. It never achieved scale or left a mark on our culture.
This personal story underscores just how difficult it is—and how rare—for even a successful business to break through. Which is part of what makes putting together our annual 50 Most Innovative Companies list such a challenge. Our reporting team sifts through thousands of enterprises each year, searching for those that tap both heartstrings and purse strings and use the engine of commerce to make a difference in the world. Impact is among our key criteria. This year marks the 10th edition of our Most Innovative Companies ranking. Looking back on that history, there are plenty of eye-opening lessons (see my article “Ten Innovation Lessons of the Past 10 Years” on fastcompany.com). This year’s list offers a brand-new slate of forward-looking ideas, from Amazon to Snap, Open Whisper Systems to Orbital Insight. My grandfather would be amazed by the radical, fast-paced changes of these companies. Here are 10 observations about the current state of the innovation economy.
Amazon and its chief, Jeff Bezos, have been defying expectations for more than two decades. The question is: How? Executive editor Noah Robischon sat down with Bezos, and what he learned points not to data metrics and rigorous processes—which Amazon deeply relies on—but rather to a willingness to embrace uncertainty, experimentation, and messy inconsistencies. Not everything in the Amazon world is orchestrated for perfection. Bezos doesn’t just tolerate this; he enjoys it. What he understands is that each critical new idea may arise in a different way, from a different source.
When Fast Company’s first Most Innovative Companies list came out, Snapchat didn’t exist. Neither did Airbnb or Uber, Slack, or Spotify. The rise of these businesses illuminates the risks that established industries face, and how tastes in modern culture are shifting faster than ever. Younger consumers expect newer, better products all the time. That reality can’t be ignored. And what starts out serving the youth will soon serve us all. As senior writer Mark Wilson notes in his terrific assessment of Snap, “The only people who underestimate Snap are those who don’t take the time to see what’s right in front of their face.”
Six of the companies on this year’s list are Chinese—more than we’ve ever had before. This was not a strategic objective of ours but a natural result of our bottom-up reporting. The days of dismissing Chinese businesses as mere copycats are long gone. As senior writer Austin Carr reports, an innovation ecosystem has taken hold in China that is arguably more competitive than Silicon Valley. Outfits like Alibaba and Tencent are so forward-focused, even the best U.S.-based businesses have to take note and—with increasing frequency—they find themselves playing catch-up. As one source tells Carr regarding the apps Alipay and WeChat, “There is no comparison with anything in the U.S. Maybe Facebook eventually gets there—maybe.”
Historically, only a half dozen or so of our 50 Most Innovative Companies are repeats from the prior year. This time, 12 are returnees. That’s because these enterprises continue to set the pace for their industries, showing agility and aggressiveness that makes them undeniable. Netflix opened up its platform to the majority of the world, and followed that up by adding offline viewing, a devilishly complex legal and business maneuver. Uber pulled a U-turn in its China business, only to double down on self-driving cars. Airbnb moved into bookings and is exploring ticket sales, and BuzzFeed took the germ of an idea, Tasty, and built a huge success. Google is disrupting photo storage, and Apple is delving deeper into chip making. Whatever distractions other businesses may face, these leaders seem impervious. They are setting their own course, and everyone else is being forced to follow.
Some changes are felt before they are seen, an underground tremor that puts us just a bit off balance. That often happens when a group of small yet creative players are deftly disrupting the same area. We highlight a quintet of companies—Glossier, Kenzo, Clique Media Group, Hypebeast, and RewardStyle—that use content as the engine for commerce. Elsewhere, we highlight Beyond Meat and Chobani, two examples of health-driven disruptions in the food business. One Medical, Medtronic, Celmatix, and Headspace point to a wave of coming tech-centered changes in the medical field, regardless of what policy makers do in D.C.
Some tech observers critique the way investment dollars are disproportionately allocated to startups aimed at rich, coastal, urban elites—and there’s certainly some basis for that concern. But there are also plenty of groundbreaking operations in other arenas. Farmers Business Network, for instance, is pooling data and buying power for individual farmers to help them better compete with agribusiness. Simplify Networks is a Malaysian outfit applying sharing-economy ideas to mobile-phone data plans in the developing world: Why shouldn’t people be able to sell bandwidth, that they’ve paid for but haven’t used, to others? And then there’s Orbital Insight, which analyzes satellite imagery to “understand what we’re doing on the earth and to the earth,” as founder James Crawford puts it. While Orbital’s revenue largely derives from financial firms, it’s partnered with the World Resources Institute to help with detecting and stopping deforestation.
Not every new venture is about making money. Some are about giving it away. Pledge 1% is targeting startups with a novel message: Along with setting aside a percentage of your business’s profits for employees and investors, why not take a portion and give it to a cause? Another tactic is at the heart of GoFundMe, a crowdsourced fundraising utility that has applied the model of Kickstarter and Indiegogo to personal giving—and already generated $3 billion.
Who cares about mattresses? As it turns out, a whole lot of people. In just a few years, Casper, which sees itself as the Nike of sleep, has built a $200-million-a-year operation on just four products. Thinx is addressing a different need: menstrual leakage. CEO Miki Agrawal is attacking an unappreciated arena in our male-centric marketplace—and making millions.
Many of the businesses and services that we love are powered by unseen forces that are essential to their success. Netflix, for instance, operates on the back of Amazon Web Services, a $13 billion business inside the e-commerce giant. Twilio provides tools to app developers—also including Netflix. IBM has unleashed its Watson technology to bring AI capabilities to industries from professional sports to health care. MailChimp helps myriad small businesses operate with more sophistication and efficiency. And then there’s Open Whisper Systems, whose security protocol not only underpins its own app but is helping Facebook provide its users with safer, more secure communications.
If there’s a single thread that runs through this year’s list, it’s the importance of focus. Over the past year, the nation’s political dialogue offered many reasons for uncertainty and pause. And yet the one sure recipe for obscurity in today’s world is stasis. Culture will keep moving, and those enterprises that move with it—that attack their missions with fearlessness—will find themselves in the strongest position to weather whatever political or economic disruption comes our way.
This article is part of our coverage of the World’s Most Innovative Companies of 2017.