Fast Track Entrepreneur and Dun & Bradstreet pick the 100 hottest new small businesses in America.

When you start a business, it's natural to hope forphenomenal growth. For a select few, this hope doesn't dwindleinto a mere echo of ambition but swells into something greater:reality. For those rising stars chosen in Entrepreneur's thirdannual ranking of the nation's 100 fastest-growing smallbusinesses, the American dream is anything but an illusion.

This year's ranking has been our most challenging, not onlybecause there are more new businesses to choose from, but alsobecause the quality of today's business start-ups is so high."Small-business entrepreneurs are a lot more professional andeducated than they were years ago," says Larry Winters of Dun& Bradstreet, the world's leading provider of commercialcredit, business marketing information, and receivable managementservices. "These people aren't starting businesses out ofeconomic need because they can't get a job somewhereelse-they're starting businesses because they want to be[business owners]."

To assist us in our difficult task, Dun & Bradstreet combedits staggering database of business information. We narrowed thelist using the following criteria:

The founder must be actively involved in daily operations andmust control at least 51 percent of the business.

• The business must have been founded no earlier than 1994.
• Annual sales must exceed $1 million.
• Companies must meet the Small Business Administration'sdefinition of a small business, based on number of employees andsales figures (which vary by industry).

From the large initial pool of companies, we calculated theannualized growth rate of each. The top 100 are listed in order ofannualized sales growth. Companies that tied in ranking are listedalphabetically. Each listing contains the founders' names, adescription of their businesses, year founded, number of employees(initially and currently), start-up investment, first-year salesand 1996 sales.

But numbers, while fascinating, aren't the whole story.We've included five profiles to give you a behind-the-sceneslook at the personalities who drive the company names. Theseentrepreneurs discuss their diverse strategies and experiences, aswell as the challenges and rewards of plunging into entrepreneurialsuccess so quickly.

Many of these and the other companies that made the cut havecarved a niche in some of the hottest industries for smallbusiness. According to Winters, up-and-coming businesses can befound in fields ranging from medical, environmental, personal, andfinancial services to specialty gift stores. Even smallmanufacturers share the unlikely label of "hot." "Alot of people think [man-ufacturing's] a sleepy industry,"says Winters, "but we're seeing a resurgence in light,small manufacturing of specialty products."

Of course, no list of hot industries would be complete without amention of technology. "There are so many different gradationsof technology," says Winters. "Manufacturers ofperipherals and chips, value-added resellers, consultants, softwaredevelopers, Web site developers-it goes on and on."

And so does our search for fast-growing new businesses.We've provided insights to the businesses, the mind-sets andthe industries that rose to the challenge this year. The nextchallenge is yours: Do you have what it takes to make the cut in1998? As this year's honorees will tell you, it's naturalto hope.-Janean Chun

Green Light

RCS corp. hasn't gotten where it is-namely No. 1 in ourranking of the 100 hottest new small businesses without the help ofothers. An engineering and environmental services company in Aiken,South Carolina, a small town of 35,000 on the western side of thestate, RCS Corp. gives a lot of credit to local and nationalgovernment, nearby environmental organizations and the area'sbusiness-friendly climate.

"There's really no single success factor here,"says Carlos F. Garcia, RCS' president and CEO. "It'sbeen all about teamwork. We all work together here."

Of course, a cooperative atmos-phere isn't the whole story.Far from it. In fact, there has been plenty of strife for Garcia,41, particularly in the business's early years. After leavinghis job as a regulatory compliance manager at a nearby engineeringand construction company because he felt he could provide the sameservices at a lower cost, Garcia started RCS out of his living roomin April 1994. To finance it, he initially took out a home equityloan and then lived without a salary for one year, all while thecompany was pulling in just a few small contracts. All together,Garcia raised $205,000 in start-up capital to get the business onsolid ground.

"It was extremely difficult," Garcia says. "I hadto mortgage all the property I owned, and, at some point, I evenmortgaged my in-laws' [house] as collateral. I had to take outenough loans to keep us growing."

And grow it did. Garcia's original business concept calledfor helping clients comply with emerging federal and stateregulations. Yet RCS quickly moved into systems engineering; healthand safety areas, including accident investigation and emergencypreparedness; and facility operations roles. The 71-employeecompany now pulls in multimillion-dollar contracts from governmentagencies, including the De-partment of Energy, and severalcommercial clients. All told, RCS grew by 114 percent last yearwith annual sales projected at $8.8 million this year.

Garcia believes a crucial chapter in his business' successstory has been maintaining low overhead. For example, in May 1996,RCS moved into what some might see as a rather unlikely location:an inexpensive, 3,000-square-foot house built in the 1890s. Becausemany of RCS' employees work at job sites, there's simply noneed for a larger facility, Garcia says. In fact, the RCS staff isquite lean, with only seven office employees to handle finance,payroll, human resources, marketing duties and more. "We wearmany different hats," admits Garcia.

Keeping a sharp eye on quality also ensures a steady stream offuture revenue. "Basically, if you do a good job on yourexisting work, you're going to get a lot more work behindit," Garcia says. Last year, for example, RCS won a $3 millionproject that grew to $8 million after subsequent contracts.

To be sure, timing has also had a little to do with it.Historically, the majority of environmental services work has beendominated by larger companies. But with substantial governmentdownsizing in the past five years, government projects are beingoutsourced to smaller companies that can do the job at the lowestprice, Garcia says. Government agencies have also been particularlyaggressive about giving more work to small businesses.

As Garcia further expands his earth-friendly business into newSoutheastern markets, his company, like all things in nature, hascome full circle. As in the past, future success, he says, dependson everyone's ability to work together. "The key is tohire great people," Garcia says, "and we make an effortto invest in personnel and work as a team. They're our realasset." -Heather Page

People Mover

Her company, Quality Staffing Specialists, may be No. 15 in ourranking and command respect in an industry populated byconglomerates, yet a little more than 10 years ago, PhyllisEller-Moffett's life was as far removed from the business worldas you could imagine.

"I stayed home with the kids, baked cookies, and did allthe things my generation was told to do," says Eller-Moffett,49. But a divorce rocked her lifestyle. "I had never worked an8-to-5 job and didn't have any skills or a college degree. Thethought of supporting myself and my children was very scary,"she says. "It's depressing to face the job world withoutknowing what you're able to do."

Eller-Moffett was as surprised as anybody by how much she wasable to do. After researching growth industries at the library, shedecided to pursue a job in temporary staffing and answered an adfor a receptionist at a Washington, DC, temp service. The woman whoowned the business hired her despite her inexperience. "Shesaid, 'I feel you can do this work and I'll give youwhatever you need to get ahead,' " Eller-Moffett recalls."She took a chance on me."

With her mentor's encouragement to learn more about theindustry, Eller-Moffett was quickly promoted through the ranks tocorporate director of sales. When the company was sold to anational chain, she once again found herself starting over. Butthis time she was undaunted. She moved to Cary, North Carolina, atthe suggestion of her son and used her savings and credit cards tostart Quality Staffing Specialists in May 1995.

By positioning herself in niches that weren't beingaddressed-the medical clerical and library services fields inparticular-Eller-Moffett says her company was"catapulted" into success. "For many companies thatnever used a temp service before, it was the answer they'd beenlooking for," she says.

Like her mentor, Eller-Moffett is dedicated to giving people achance. "We want to get people into jobs so they can get onwith their lives," she says. In fact, Eller-Moffett hasinstalled a Brag Board in her office, a montage of employees'thank-you notes which, she says, "has ended up huge."

Her future's looking huge as well. This year, with theopening of a state-of-the-art computer training center,Eller-Moffett expects her com-pany's phenomenal growth tocontinue, reaching $4 million in sales. But whatever innovationsshe adds, she plans to keep her dedication to her employees thesame. "We treat them the way we'd want to betreated," she says, "and it's paidoff."-J.C.

Full Speed Ahead

Talk about zero to sixty. Auto-By-Tel Corp., an Internet servicethat makes the purchase process easier for new car buyers, hasexperienced such rapid growth in the two years since it startedthat somebody had better post a speed limit sign. With sales of$274,000 in 1995 and $5 million-plus in 1996, it's no wonderthe Irvine, California, company landed the No. 4 spot in ourranking.

Sure, Auto-By-Tel was a bona fide overnight success. Thatsuccess, however, didn't come without a few speed bumps alongthe way. Originally, founder and president Pete Ellis wanted theautomobile-purchase service to air on TV shopping channel QVC, butafter learning that marketing the business via the Internet wouldcost significantly less, Ellis changed gears. Auto-By-Tel went liveon Prodigy in March 1995, with astounding results.

"In the beginning, we hoped [to get inquiries for] 50 carsa day," says Ellis, 50. "But on the fourth day, we got1,348 requests for cars. That's when we realized this is theway mainstream America wants to buy cars."

Ellis started the business because he detested the way theindustry worked. "I've always thought the [purchase anddistribution] model was wrong--too many unpleasant practices forcustomers," says Ellis. He also felt the dealer-to-dealercompetition that resulted "made it very difficult to do whatyou wanted to do for the customer." The solution? Create awhole new way of doing business.

Auto-By-Tel allows car shoppers to research vehicles via theInternet, then get referrals to a network of reputable dealers thatwill give them price quotes over the phone and a promise not tohaggle once customers set foot on the lot. Through Auto-By-Tel,customers can also obtain low-cost auto insurance and financing,plus rock-bottom prices on used cars and leases.

The typical customer, says Ellis, knows what he or she wants."Say I want a 1997 Eddie Bauer [Ford] Explorer with leatherinterior and a moon roof, and I want it in cranberry," saysEllis. "I'm ready to buy this car if the dealer treats meright. That's the customer we send to the dealer."

Not surprisingly, aside from cozying up to car buyers,Auto-By-Tel is a hit with dealers, whose per-car marketing costs godown when they're part of the Auto-By-Tel network. According toEllis, the typical car dealer spends $200 to $300 to market a newcar, plus $800 to $1,100 in personnel costs. "We get thosecosts down as much as 80 percent," says Ellis. Manufacturersalso love Auto-By-Tel because customer satisfaction after purchaseis sky high, which reflects positively on them.

What else has made Auto-By-Tel such a success? Word of mouth."Plus," says Ellis, "we have a great network ofdealers." Apparently, he's helping those dealers leaveregular dealerships in the dust.-Lynn Beresford

S-s-smokin'!

Shelby Smithey and Tal Holloway's business is on a hotstreak: After recording 1996 sales of $1.2 million, the pair expectto double that amount this year. Give these men a cigar!

But perhaps that isn't necessary. You see, Holloway andSmithey (37 and 42, respectively) are the founders of No. 24-rankedCigar Classics Inc. in Cary, North Carolina. And just as cigarshave caught fire in the marketplace, so, too, has this 2-year-oldcigar accessories enterprise.

"One of the things we've done quite well is come upwith innovative new products that fill a niche," explainsSmithey, a cigar enthusiast who saw a need for protective cases toprevent cigars from getting crushed or drying out.

Enter Tal Holloway. A neighbor of Smithey's, Holloway drewon a mechanical background to help design prototypes forcigar-friendly products. The result? In August 1995, Holloway andSmithey came out with their Pocket HumidorT.

"We needed something that would protect cigars relativelyindefinitely," says Smithey.

Echoes Holloway, "The true connoisseur of cigars realizesthe importance of keeping cigars at their properhumidity."

And yes, there certainly is no shortage of cigar connoisseursthese days. "Right now, the demand is so great, it'sunheard of," says Smithey of the cigar craze that'ssweeping the nation. "People just like to savor [cigars]. Ifind cigars relaxing. It's almost a form ofmeditation."

Interestingly, Holloway did not always share his partner'senthusiasm. Prior to launching Cigar Classics, in fact, thepilot-turned-entrepreneur didn't even smoke cigars. That'schanged, though: "Now, every time we have a meeting on hisdeck, we have a cigar and a beer and talk about business,"says Smithey. "[Tal has] acclimated quite well."

Then, too, the same could be said of both partners with respectto the rigors of entrepreneurship. Fueled by burning ambition and arange of products from humidors to cigar cutters, Cigar Classics isclearly on a roll. -Debra Phillips

Piping Hot

It's been said that a good reputation is more valuable thanmoney. For Joseph Hurtado, Mark Gingell and Don Peters, founders ofMid-Continent Mechanical Inc., this saying could well be theirmantra.

The trio of Missouri plumbers stressed the importance ofcultivating an impeccable reputation for their full-serviceplumbing contracting firm well before opening its doors in 1995.That emphasis has paid off handsomely. After nearly two years inoperation, the Kansas City firm, ranked 37th in our listing, postedsales of $1.8 million last year and projects more than double thatin 1997.

One factor that helped the trio initially was the company'sminority business enterprise (MBE) status. "[Originally], weexpected about 50 percent of our income to come from our status asan MBE. But it's much less [about 17 percent]," saysPeters, 54, who is primarily responsible for estimating jobs.(Gingell, 38, is the company's field superintendent.) While thetrio did not expect to rely on their MBE status, they used it,along with their 76 years of combined industry experience, as awedge to open doors.

One of the biggest doors Mid-Continent opened was that of J.E.Dunn Construction Co., a leading commercial contractor in KansasCity that in 1995 had more than $447.5 million in overall billings."Through the MBE structure, we approached J.E. Dunn,"recalls Hurtado, 47, Mid-Continent's president. "Theydidn't know a lot about us but knew our individual reputationsand figured they would try us on a small job first."

Mid-Continent performed so well on that $5,000 contract, itquickly led to a second J.E. Dunn job worth more than half amillion dollars.

"It was a large contract and also very hard to perform, andthey were wondering if we could keep up with the schedule,"says Hur-tado. "We not only kept up with our work, we finishedabout 45 days before any of the other [subcontractors]."

That success is a far cry from the early days, when the foundersworked 14-hour days and forsook salaries for the first five months.But even during that long, hard stretch, they had no doubts theircarefully laid plans and dedication to providing top-qualityservice would pay off.-Cynthia E. Griffin

About Dun & Bradstreet

Dun & Bradstreet (D&B), with the world's largestbusiness information database, tracks 44 million companiesworldwide, 10.7 million in the United States alone. Businesses useD&B's services to find new customers and evaluate theircreditworthiness, identify potential suppliers and collect overduereceivables.

Through face-to-face and telephone interviews and public recordssearches, more than 200 million financial transactions are added toD&B's files annually, and that's just in the UnitedStates. D&B updates its information base continually-more than750,000 times each business day.

When businesses are entered into the D&B database, they areissued D-U-N-S numbers (similar to Social Security numbers forcompanies). Required by the U.S. government for all businesses inits Central Contractor Registration database and used by the UnitedNations and the European Union, the D&B D-U-N-S number isquickly becoming the universal standard for identifying businesseson the World Wide Web as well.

For more information, call (800) 234-3867.

Contact Sources

• Auto-By-Tel Corp., (714) 225-4500;
• Cigar Classics Inc., 114 New Edition Ct., Cary, NC27511-3491, (919) 460-3882;
• Dun & Bradstreet, Small Business Services, 3 SylvanWy., Parsippany, NJ 07054, (800) TRY-1-DNB;
• Mid-Continent Mechanical Incc., 1924 Linn St., NorthKansas City, MO 64116, (816) 471-5758;
• Quality Staffing Specialists, 107 Fountain Brook Cir.,Cary, NC 27511-4491, (919) 481-4114;
• RCS Corp., (803) 641-0100,(http://www.rcscorporation.com).
• 3D Exhibits Inc., (630) 530-2648;
• Advantage Transportation Inc., (602) 331-0808;
• Electronic Design Group LLC, (602) 951-3200;
• GT Equipment Technologies, (603) 883-5200;
• Hearthside Lending Corp., (816) 452-8900;
• Ingear Corporation, (847) 821-9600;
• Intuitive Manufacturing Systems, (206) 889-2121;
• Lighting Management Consultants, Inc., (713)777-4562;
• Magnum Machining Inc., (507) 288-1280;
• Necsas Corp., (401) 624-1420;
• Northwest Florida Home Center, (904) 547-5070;
• Octagon Air Systems LLC, (404) 608-8881;
• Palmetto Industries Int'l. Inc., (706)790-6999;
• Performance Door & Hardware, (972) 721-1944;
• Phoenix Transportation Services Ltd., (606)254-2400;
• RCS Corporation, (803) 641-0100;
• Resolution Graphics Resources Inc., (913) 599-5000;
• Shonfelds (USA) Inc., (201) 569-7557;
• Softline Consulting & Integrators Inc., (408)988-6141;
• Switch Manufacturing, (415) 777-9415;
• Systems America Inc., (408) 987-4900;
• The Southern Group Inc., (601) 328-0636.
• Ability Center, (619) 541-0552;
• Baroli Engineering Inc., (310) 715-6191;
• Bri-Mar Manufacturing Inc., (717) 263-6116;
• Brittan Communications Intl. Corp., (713) 659-8700;
• Cabletec Inc., (410) 287-4915;
• Commercial Office Resource Group, (909) 693-9443;
• Davocom One Inc., (305) 854-4333;
• Hometowne Building Company LLC, (810) 539-7711;
• J & B Technologies Ltd., (314) 993-5528;
• Loss Control and Recovery, Inc., (407) 839-0088;
• Matteo Family Kitchens Inc., (609) 769-2490;
• Mediastore, (714) 997-5551;
• Micro Contract Assembly Inc., (714) 472-8880;
• Peter Carol Knitwear Inc., (718) 497-2573;
• Premier Roofing Inc., (619) 667-4565;
• Requirements Inc., (770) 476-4300;
• Sente Financial Corporation, (916) 569-0700;
• Team Contracting LLC, (812) 246-6111;
• Teksystems Fire Protection LLC, (414) 482-0808;
• The Computer Shack Corporation, (303) 986-2799;
• Total Systems Solutions Inc., (703) 502-4300;
• Westwinds Wholesale Doors Inc., (405) 947-3437.
• Adams & Taylor Inc., (510) 939-4838;
• Alliance Telemanagement Inc., (215) 340-0773;
• Apex Window & Bath Accessories, (520) 741-8115;
• Bear Cartage & Intermodal Inc., (773) 376-3500;
• CDS DataComm Inc., (214) 340-9199;
• Cabinet Connection of Treasure Coast, (561)220-5870;
• Casa Di Oggi Inc., (305) 933-1022;
• Custom Truss Inc., (814) 687-4211;
• Damage Control & Restoration, (414) 672-3409;
• Data Vista Inc., (414) 790-1188;
• Davis Industrial Pipe & Supply, (562) 407-1188;
• Energy Alloys Inc., (281) 821-8787;
• Gorman & Gorman Residential Mortgage Services, (314)994-9999;
• Leather Creations Inc., (770) 448-0333;
• Metro Fire and Rescue, (618) 539-3177;
• Midwest Fixture Group Inc., (612) 529-6404;
• Miller Paper Company, (806) 353-0317;
• Mortgage One Group USA, (606) 647-6479;
• Netcomm Group Inc., (317) 773-0620;
• Shop-N-Save Supermarkets, (201) 372-3300;
• Synapse Micro Inc., (972) 417-3959;
• The Network Group, (208) 388-1601;
• Travel Design Inc., (901) 683-0588;
• Unitrans Worldwide Inc., (617) 961-3540;
• Valve Solutions Inc., (770) 740-0800;
• Voyager Telecommunications, (703) 551-2075;
• Wasatch Security Group LLC, (801) 487-7233.
• AllTech Data Systems, Inc., (630) 595-5055;
• Architectural Doors & Hardware, (717) 767-7724;
• Aspen Landscape Services, (714) 756-8865;
• Clutch Cargo International Inc., (847) 860-4800;
• Comdex Group Inc., (305) 592-5153;
• Con Heart Construction Inc., (510) 373-9600;
• Cooper Randall & Fox Inc., (201)224-3800;
• Eastern Flooring Inc., (301) 772-5531;
• Excel Business Systems Inc., (614) 228-2112;
• Family Savers, (504) 828-2700;
• Hart Transportation Inc., (904) 786-0805;
• Kokopelli Ltd., (410) 997-9470;
• Lighting Energy Controls Inc., (201) 462-0900;
• MedRx Inc., (813) 392-9000;
• Pahrump Valley Door, (702) 727-1040;
• Patriarc Gas & Welding Supply Co., (814)539-2833;
• Peach State Lumber Products, (770) 428-3622;
• R & R Supply Company Inc., (334) 213-0351;
• RD/Fox & Company, (415) 357-4545;
• RL Hoener Co. Inc., (217) 223-2190;
• Right Choice Staffing Services, (770) 988-9544;
• Sams Data Products Inc., (410) 626-1201;
• Total Office Solutions Inc., (601) 853-8400;
• United Paradyne Corporation, (805) 348-3155;
• Zabransky Mechanical Corp., (201) 296-0633.