One of the bright sides of the general collapse of the economy combined with the intrusion of big government is the emergence of self-reliance and entrepreneurship. We have seen a spark of innovation in the industry that is provoking many start-up companies to take the go big or go
home attitude with their companies. In the absence of investment and venture capital dollars to fund marketing opportunities many companies are turning to the analysts to get product validation, contacts, and exposure in the industry. A word of caution; while this is a good strategy, AR pros must have their preverbal ducks in a row before engaging with the analysts.
In many start-ups executives tend to focus too much on their products and what it does - feature and function. However, in this new economy executives need to be prepared to discuss a broad range of topics when initially meeting with the analyst community. Additionally, it is easy to become desperate and with hyperactive CEOs too many vendors feel compelled to brief the analyst community at the earliest possible moment so as not to be trumped by their competition.
Announcing too early means that the natural evolution of product and market plans will start to look like a strategy du jour of a floundering vendor or, worse yet, a solution searching for a problem.
The biggest challenge for start-ups is overcoming the reasonable skepticism of analysts, especially the dealmakers/breakers (Gartner, Forrester). Frankly, start-ups come and go with alarming speed. This is in part due to the lack of experienced professionals to staff all these new companies, but also because of the lack of real-world experience, skills and domain expertise in the venture capital community. Consequently, new vendors need to go into their initial analyst briefings fully prepared to demonstrate not just "an insanely great idea" but their ability to execute as well.
Analyst Relations is about relationships so it's vitally important for the company to own that relationship from the beginning to end. We recommend NOT using your PR firm for anything other than scheduling briefings and managing the calendar. That said, you must ensure you have the following completed before engaging with the analysts:
Have your Strategic Positioning Statement in place. A crisply articulated Strategic Positioning Statement is a standard requirement or any analyst interaction. This includes who you are, what you do, why you are different, and why people buy from you.
A product should be available. There are a few exceptions to this rule, but very few. Vendors should have at least a late beta version of their product ready prior to talking with the analysts. There should be at least some beta customers. No referenceable customers = no briefing - period. Even a software company whose initial product is really more "consultantware" (i.e., a nearly unique piece of software code for each customer) has a better opportunity of validating
their vision than a vendor without any customers or references.
Well thought out plans should be in place. One way that a vendor can start the process of building credibility with the analysts is to show that they understand the various issues they need to address, they have a prioritized plan to address the issues and that they have a roadmap for acquiring the resources needed. This does not mean that the vendor has to have the answers, but they should at least know the questions. It is important to predetermine what should be planted in the mind of the analyst at the end of the interaction. Not only will this help focus the interaction, but it will also drive the creation of the presentation and supporting material.
It is important to predetermine what should be planted in the mind of the analyst at the end of the interaction. Not only will this help focus the interaction, but it will also drive the creation of the presentation and supporting material. Key outcomes include:
Target the Right Analysts. With limited resources and budget, many startups tend to focus on the analysts that pay them the most attention. This causes executives to waste time speaking to analysts that cannot help them drive revenue or even exposure. It is important to focus on the most influential analysts in your market, not just the ones that write about you or will provide a comment for a press release.
Establish a Compelling Vision and Differentiation. With so many vendors introducing themselves to the analyst community it is important for new vendors to show that they have solid insight about their market and are not a "me too" latecomer.
Demonstrating Understanding of Key Issues. The desired outcome here is to prove that the new vendor has a realistic view of the world with plans and priorities that appropriately match the product vision and resources available.
Proving the Ability to Execute. Although many companies are being forced to become "Two guys in a garage" again (and that may be the romantic myth of the IT industry) in this day and age it is important that new vendors show that they have the management skills, people and financial strength to survive the start-up phase.
Placing a Stake in the Ground to Establish Future Credibility. Because of a paucity of actual reference customers, new vendors need to lay-out milestones for the next two to three quarters, the execution of which will be the foundation for building credibility.
