Today I attended a new conference for entrepreneurs in Silicon Valley called She’s Geeky. The organizers, a group of founders, prefer to call it an “unconference” because they don’t pre-set the agenda. But they do arrange some interesting panels.
I attended the one called “Dealing with Analysts, The Good the Bad and the Ugly,” a roundtable on when, how and why to pitch your startup to an industry analyst. (This is “analyst” in the Forrester, Jupiter-tradition; not equity or financial analyst). I was skeptical.
I’ve read research from these firms before, to learn more about an emerging technology (the iPod; OpenID), or the growth prospects of a new market (ad-serving or SMS for social networks). Usually it’s in the context of how such things might expand or infringe upon the existing businesses of established companies (like Microsoft or Google).
A nice product review might be a ego-stroke for a developer, but I was less convinced that the investment — in hours and dollars — to “brief” an analyst on your beta is worthwhile to a cash-strapped startup with few customers or market presence. To give a briefing, you must often become a paying client of one of these firms first!
But I stand corrected. An hour spent with an industry analyst — at a cost of $500 to $5,000 — can deliver some real bang for your buck.
I asked the panel, including Forrester’s Charlene Li (Web2.0 & social computing), Rachel Chalmers, of the The 451 Group (enterprise software), and Julie Ask, with Jupiter Research (telecoms), to call out 3 or 4 tangible benefits to be gained by a startup founder from a paid-for-briefing.
Here are 4 ways a “briefing” can buy you quick market research, help refine your business strategy, even (re)position your product.
I. Free market reconnaissance
“By briefing us, you’ll also get useful feedback on [your] industry,” says Jupiter’s Ask. “We are the industry experts so we can give you perspective [that what you don't already have.]“
“I know who the [big vendors] in a marketplace are, what they’re looking for and what the market needs [in new products.] Not every company can afford thousands of dollars in market research. But they [also] cannot afford to go into a market before they’re ready. I sell my time in 30-minute increments, and you probably can afford a $100- or $200- or $300-report. So before you spend thousands of dollars going into a market you don’t need, or extending your product … give one of us a briefing. It can save you money,” says 451 Group’s Chalmers.
II. You’re commissioning credibility
“I have press call me all the time, wanting to know of if I’ve heard of a company, or what I think of a technology. If you’ve briefed me, I can tell a reporter about you,” says Ask. “If I like[d] your product, I’ll mention your company whether you’re a client or not. Contrary to what people think, it’s not all a pay-to-play-model… So [a briefing] is an investment in your credibility,” for down the road — when a reporter is calling around to vet it.
III. A cheap sanity check
“I can’t tell you the number of times a startup has come into a briefing and said to me: “We’re the only ones doing this. And I can say to them, ‘No you’re really not,’” says Chalmers. “Better you know that now, [rather] than later. So coming to us can be sanity check for an entrepreneur.”
IV. Analysts are willing connectors
“You might say, how can analysts help differentiate [my company] for $5,000 to 10,000?,” asks Forrester’s Li. (That’s a typical client-fee at one of these firms). “I introduce a lot of companies to future partners or companies that end up acquiring them. We all see startups from their seed funding [stages] through companies in the acquisition or IPO stage. And VCs and bankers call me all the time looking for new [candidates]. So we can be valuable connectors for startups.”
TWO last TIPs on HOW to do a briefing:
1) Do it in person. “I try to do 40 to 50 briefings a quarter. The key to getting in is to follow-up. Then do it in person,” says Li. “It’s harder to hold my attention when it’s just a voice over the phone.” Adds Chalmer: “It’s easier [for you] in person. Human nature is that we want to like the person.”
2) Make it quick. “There is very little that I can get in 60 minutes, that I can’t get in 15-30 minutes,” says Ask. “I’m only interested in what you’re doing now…not the 10 things an entrepreneur has done before, or whether your IPO will be a blockbuster.”