As we said in Should tech startups invest in analyst relations?, the currency startups should use with analysts is not euros, yuan, pounds, dollars, yen or pesos. No, the real currency is information (and the executive time to deliver the information).
Startups need to provide analysts with all the usual information such as strategy, ability to execute, product road map and so on. However, startups will be at a disadvantage to mature vendors in some areas like formal customer references. As a consequence, startups need to mix in some information or data that they are better suited to know and share. In this article, we will offer some suggestions for topics that startups might have unique insights that will appeal to analysts.
Customer stories – While customer stories are always top of the list of analyst wants, startups can offer some especially interesting aspects. For instance, what is the customer’s competitive situation that they think that the emerging tech or your company can address? This topic can be addressed even if you cannot give the name of the early customer.
Insights from the market – Analysts are always on the lookout what is happening in markets. Because emerging technology markets have fewer players – vendors and customers – it is harder for analysts to get updates through their normal vendor briefings and client inquiries. Startups can provide intelligence on the growth, stumbles, vertical industry adoption and competitive landscape that may not be available to the analyst in any other way. These appeals to the analyst’s need to be ahead of their peers (see Know your analyst – Novice, Luminary or Sage).
Technology trends – This is an especially good topic for startups because their chief technology officers (CTO) will be passionate about the geeky aspects and will have geek street cred. However, AR has to be careful that the CTO does not get down in the weeds and overwhelm the analyst with detail. Many analysts are no longer intimately involved with technical details – if they ever were — and usually are more comfortable with the 30,000 foot view of technology.
Market category definition or extension – There are some analysts who are coolhunters, always looking for that nascent market trend that they can publicize and be associated with. Part of the effort is coming up with crisp definitions of a new market category or the redefinition or extension of an existing category. While the coolhunter-style analyst will never take a startup’s category definition verbatim, startups can certainly influence the direction of the definition.
Connecting emerging technology to better known macro trends – Because startups are so focused on an emerging technology, they are in a position to connect the dots between the new and the established trends. However, because the startup is also so immersed in its little patch of technology, there is a tendency to over connect its cool new technology to everything in the macro economy. To preserve credibility, startups should focus on only those macro trends that have the strongest connections and support the startups’ strategic plans.
What are the VCs doing – While not as interesting a point to many analysts, some analysts will appreciate a discussion about trends in VC funding activity. However, startups should never use the fact that they received a check from a VC as a proof point for future viability or success.
SageCircle Technique:
- Actively seek out deep insights about your emerging market
- Mix in the unique insights with the more typical information given to analysts during a briefing
- At the end of a briefing, ask the analysts if they would like follow up conversations on a few sexy topics. This could prompt the analyst to ask for another briefing or two, which is better than the startup initiating the briefing request process again
- Startups should use their unique insights quickly after they identify them. In the Internet, information has a short shelf life so startups should exploit their ability to move fast.
Note : Readers should check back periodically over the next two weeks for updates to this article. SageCircle is experimenting with using social media to poll players in the market for their opinion on this topic. Additional suggestions will be added to the article as they come along.
Bottom Line: Startups should always be alert to the opportunity to include unique market insights as a means to engage the analysts and obtain analyst-requested follow up briefings.
Question:
Analysts – What does a tech startup know that would be really interesting to an IT industry analyst?
Startups – What other topics should a startup be looking to exploit that makes them interesting and standout versus mature vendors?
Are you leveraging all the interesting stories you have with the analysts? SageCircle can help. SageCircle strategists can:
- Train clients how to persuade early customers to act as analysts references even if they will agree to be sales or press references.
- Review information to be provided to the analysts to ensure that it is as powerful as possible.
- Critique analyst briefing content to ensure that unique startup insights are appropriately mixed into the presentation.
For more information on how SageCircle can help startups leverage the market power of the IT industry analysts please contact info [at] sagecircle dot com or 650-274-8309.
Since 2000, SageCircle has helped analyst relations teams to focus on business value by encouraging innovative thinking that leverages insights and drives revenue.
Carter,
I’ve always been welcoming to interesting startups for intelligent discussions, but should add the following nuggets for startup leaders to think about before engaging analysts:
1) Cut down on the vaporware and keep the discussion open and honest. You are not IBM or Accenture, so I may not have a great deal of patience for the ivory tower stuff;
2) Get straight to the value propositon – what is it that will make you unique in the market? There’s nothing worse that talking with a startup, and you still didn’t really understand what their USP was after the briefing;
3) Tell me something I don’t know about the industry – most startup leaders are high-energy visionaries who really know their stuff. I like meeting people who can tell me something knew and engage in good discussion about the direction of the industry;
4) Where are you with being “market ready” with your product / service – and are you ready to have clients / beta clients talk to us directly about you? Nothing beats a good client reference…
4) How robust is your funding situation, and who are the key players in making you successful (having known investors is a major plus)?
5) Would you be interested in my research program? A good analyst / startup advisory relationship can prove invaluable to a startup trying to understand its competition, its potential customers / partners / alliances and having a sounding board to help with positioning / networking etc. Looking back at my years as an analyst, some of my fondest client relationships have been with the little guys trying to break into the big time. And for those that did, I feel good about playing a part in that development.
PF.
Start-ups can be an excellent early barometer of developing market trends and dynamics that the savviest analysts use as a tool to stay abreast of what’s happening. Particularly if multiple companies are doing similar things in a space.
Start-ups can establish analyst relationships to help build “back-end” market credibility and awareness that can come in useful in other conversations that both analysts and start-up execs have with respective/prospective customers, partners, acquirers, and so forth.
That said, I don’t believe that an analyst relations program should be “de rigueur” for EVERY start-up out there. Whether a start-up engages with analysts should depend on a number of factors:
– Impact: what are they doing and how (potentially) impactful to customers’ businesses, and the industry, is it?
– People: what are the personalities of the start-up principals? Do they value and/or know how to maximize analyst relationships?
– Timing: how far along is the start-up in executing its strategy? Can the analysts provide beneficial recommendations, feedback, and suggestions to the company to help it execute better? Is the company receptive to this?
– Investment: does the start-up have the time, energy and DESIRE to establish analyst relationships? Many start-ups (particularly early to mid-stage) are focused to the exclusion of marketing, PR and AR. Doing analyst relationships RIGHT takes commitment, time and money — often more than a start-up CEO and execs are willing to invest. Of course, others bring established analyst relationships with them from previous positions, and this is a huge bonus.
Cheers,
Gerry
Thanks for the comments. We do beleive that SOME startups are missing an important acitivity by not engaging the right analysts, for the right reasons, at the right timing. Unlike more traditonal vendors they need to be especially creative in their approach to make it effective. Your suggestions are appreciated.
Dave