While most of the market focuses on the top end of town, a small number of investors are looking at the opposite end. Those small-cap companies that have the potential to become large caps over time.

The main reason is quite simple. A small cap company can generate huge growth more easily than say the likes of Telstra Corporation Ltd (ASX: TLS) or Commonwealth Bank of Australia (ASX: CBA). Both those behemoths are currently struggling to generate revenue growth of more than 5%.

Here are three companies that could grow up to be much bigger one day…

LandMark White Limited (ASX: LMW)

A small property valuation company with a market cap of just $19 million, LandMark White recently reported a 14% increase in revenues to $28.2 million and a net profit after tax of $1.7 million – up 113% compared to the 2015 financial year (FY15). The company also declared a fully franked final dividend of 3.25 cents, taking total dividends to 4.5 cents per share. On those numbers, LandMark White shares are trading on a P/E of 11x and paying a trailing yield of 6.5% – which grosses up to 9.2%. The future looks bright too with LandMark White saying it is well positioned to grow.

Schaffer Corporation Limited (ASX: SFC)

Schaffer is an odd, diversified industrial company with core operations in building materials, automotive leather and property. The Automotive Leather division is the largest and generates around two-thirds of revenues, with building materials generating most of the remaining third. Schaffer – with a market cap of $72 million – recently reported revenues of $187.2 million and a net profit after tax of $5.7 million. The company also declared a 25 cent fully franked dividend. On those metrics, Schaffer’s shares are trading on a P/E ratio of 12.6x and yielding 4.9% fully franked.

Villa World Ltd (ASX: VLW)

A property developer, Villa World is the largest of the three companies with a market cap of $279 million at the current share price of $2.46. Today the company reported stellar 2016 financial year results, with revenues up 20%, earnings per share up 19% and dividends up 13%. The group has a good track record in the past few years of growth, with revenues of $387 million and NPAT of $33.7 million this financial year. That places shares on an undemanding P/E ratio of 8.3x and with an 18 cent dividend per share, a yield of 7.3% – fully franked – which grosses up to more than 10% when franking credits are included. Villa World expects to see at least 5% growth in NPAT in FY17 and a dividend of at least 18 cents again.

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Motley Fool writer/analyst Mike King doesn't own shares in any companies mentioned. You can follow Mike on Twitter @TMFKinga

The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.