7 Former Fastest-Growing Companies

September 6, 2012, 2:50 PM UTC


List year: 2005
Rank: 1

Yahoo may be struggling to find its way now, but back in 2005, the company was on Fortune's hot list. Ranked number one that year on our Fastest-Growing Companies list, Yahoo was the company to watch. Since then, Yahoo has held on to valuable assets, but never really figured out how to streamline them, losing ground and market share over the years to search giant Google.

Part of the company's recent problems has been due to its trouble keeping leaders. The ungraceful departure of former CEO Scott Thompson, who was accused of lying on his resume, was only the most recent event in the HR soap opera.

Things at Yahoo are looking up, however. The company just hired former Google exec Marissa Mayer as its new CEO this past July. She may have a shot at creating a coherent rebound strategy for Yahoo to get it back on the growth list again.

Vineyard National Bancorp

List year: 2005
Rank: 4

Vineyard National Bancorp specialized in financing homes in southern California, and business was good in 2005. But the bank made some bad loans to home builders between 2005 and 2007 and consequently, it lost over $80 million during the first half of 2008. The previous year, it had a profit of $11.5 million. Bad financial results combined with the uncertainty in the real estate market caused customers to start yanking their money. In July 2009, the FDIC took over the bank.

Chesapeake Energy

List year: 2005
Rank: 46

Chesapeake Energy CEO Aubrey McClendon had tunnel vision on growth, and for a while, the strategy paid off. Chesapeake was #46 on Fortune's Fastest-Growing list in 2005.

McClendon's strategy was to buy massive tracts of oil and gas land and reinvest the company's profits so it could grow more. Unfortunately, McClendon banked the future hard on natural gas, which is expensive to drill yet still cheap to sell in America. This move caused Chesapeake to amass an unstable amount of debt. In April, news broke that McClendon's personal money was getting tied up in company business. The company was under investigation by U.S. regulators in August for possible collusion with a competitor to lower the price of oil and gas land in Michigan.

So Chesapeake isn't going under, but its growth strategy was built on shaky ground.


List year: 2006
Rank: 18

Netflix was killing it in 2006. In fact, the DVD rental company had such an impressive business plan that in 2010 Fortune named CEO Reed Hastings Businessperson of the Year. Hastings was already hearing footsteps, he told us then, "The turnover in the S&P 500 is terrifying. Most of the time change in the world overtakes you."

And it did. Netflix has been struggling to regain its traction since last year, when it announced a short-lived plan to split up its DVD and online services. Prices would increase, and the DVD portion of the company would be called Qwikster, the company announced. Consumers were livid, and Netflix had to retract the whole shebang immediately. The stock took a dive, and it still has yet to reach anything close to its pre-announcement levels.

Edge Petroleum

List year: 2006
Rank: 8

Edge Petroleum was founded in 1983 as a crude oil and natural gas exploration, development and production company that was known for making high-risk investments. The strategy didn't carry Edge through the financial crisis.

Shortly after Edge made Fortune's list, its stock value started declining. The company planned to merge with Oklahoma City-based Chaparral Energy in 2008 to save it from extinction, but the deal fell through in 2008, with both companies citing the tough economic environment as reason for the deal's failure. Edge filed for Chapter 11 in 2009, announcing that all of the money from the sale of its assets would go to its creditors.

United States Steel

List year: 2006
Rank: 44

2006 was a great year for United States Steel. That year, the company reported a net income of $1.4 billion for the year compared to a net income of $910 million the year before. It continued to chug along until the world economy ground to a halt in 2008 when its stock peaked and then took a nosedive.

In 2008, the company was forced to lay off 3,500 salaried and union workers, since raw materials were in lower demand. United States Steel didn't go under, but while the economy is recovering, growth in the steel market is still slow.


List year: 2009
Rank: 1

When RIM released the Blackberry in 2003, there was nothing like it on the market. Businesses and IT professionals loved the smartphone so much that it was, at first, able to hold its market share even after the introduction of the iPhone in 2007. RIM was the top company on Fortune's 2009 fastest-growing list. But the company overestimated its staying power, and banked on its great security settings to keep corporate customers buying its phones.

The company wasn't prepared for the current trend of employees bringing in their own devices made by consumer-focused companies like Google and Apple to work. Now, RIMM is working with JPMorgan and RBC Capital to "review its strategic options." In other words, anything, including a sale, could be on the table for the Canadian tech company.

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