Call it a Companies Town.
The 10 fastest growing private companies in L.A. are about as diverse a lot as you’ll find, covering software, educational retailing, mortgage lending, natural gas trading and aerospace manufacturing. Numbers 11-100 are just as varied.
The Business Journal established certain parameters for this year’s list that we believe provide for a better cross-section of L.A. business activity. To qualify, a company must be privately owned, be based in Los Angeles County and have 1997 revenues of at least $5 million. This last criterion allows for both fast-growing start-ups and more established businesses. (Advertising agencies, banks and non-profits were excluded because their growth measurements typically are not based on revenues.)
It’s a niche-oriented group and reflective of the wave of small- to mid-sized L.A.-based companies. Some of them are likely to be gobbled up in the months and years to come. For the moment, though, they say a lot about L.A.’s entrepreneurial economy.
1
Platinum Capital Group
Business: Mortgage broker
Location: Manhattan Beach
Revenue Growth: 788.3%
Not one for subtlety, Platinum Capital Group co-founder and CEO Mark Moses has ridden an elephant into the company’s annual meeting for the last couple of years. The elephant, he says, embodies the company’s motto: “Think Big.”
Over its five-year history, Platinum’s corporate strategy has been to do just that. What started as a three-person mortgage brokerage, launched by two men in their 20s with an entrepreneurial bent, has evolved into a 300-person, four-branch operation that provides full-scale brokerage services. Platinum offers a range of loans for residential real estate and has forged lender relationships with 26 realty companies.
“They are extremely progressive in their business plans and aggressive in going after what they want,” said Larry Wolf, co-owner of the Manhattan Beach-based Shorewood Realtors Inc., which has had a lending agreement with Platinum for the last four years. “They’ve also provided extremely good service and have made close relationships within the lending community. I haven’t been surprised at all by how fast (Platinum) has taken off.”
But according to Brett Dillenberg, Platinum’s co-founder and president, the company got off to a rocky start.
“When we started this business, I thought we had several of my clients following me, but they didn’t,” said Dillenberg, who went straight into the mortgage business after graduating from USC in 1989. “Then in 1994, the Fed raised interest rates several times and something like 50 percent of the companies in this industry went out of business. We survived only because we went directly to our consumers, with our loan officers working their databases, their friends and family. We also launched a massive ad campaign at the time. It may have been unconventional and it certainly got tight, but we survived.”
The company took off the following year, posting 1995 revenues of $2.2 million. By 1997, revenues were $19.2 million and this year the number could approach $29 million.
Each of Platinum’s offices has a specialty a diversification strategy that comes in handy if one segment of the market goes soft. In mid-1996, Platinum opened an office in La Mirada that catered to the Latino first-time home market and the FHA market. Platinum’s office in Encino serves the same niche.
“Hispanic first-time home buyers is a demographic that is rapidly growing throughout Los Angeles County,” Dillenberg said. “We expect this market to continue to grow, and we’ll be well positioned to serve it as it does.”
Platinum’s Orange County office, which Moses heads, has gone after the second trust-deed market and deals heavily with home-improvement loans. The office, which is less than two years old and has run an intense ad campaign of its own, has grown from four to 100 employees. Executives expect the office to continue growing to keep pace with demand.
Meanwhile the headquarters office in Manhattan Beach serves the growing South Bay real estate market. Platinum’s management also eagerly awaits the housing development planned in Playa Vista, which is expected to bring more first-time homebuyers into the area.
The brokerage also is going after new customers by striking unconventional arrangements. In exchange for being recommended as the home lender through a firm’s benefits package, Platinum offers favorable loan rates to that company’s employees. Although the profit margins are lower for these loans, it’s made up in volume.
“I’d say that our ability to get out of the day-to-day loan business and focus on strategy and development has been key behind our company’s growth,” Dillenberg said. “It lets us think big and stay in control.”
-Sara Fisher
