technology analyst 101 for startups - introduction

At Gartner, I spent a fair bit of time with startups. Many of whom didn't know what to do with analysts. Now that I'm other side of the table, here's a 101 on tech analysts for startups.

Tech Analyst 101 for Startups

Part One - introduction to analysts / what they do

Part Two - why you want to talk to them / what they can for do you

Part Three - how to engage with them / what you should do with them

Part Four - wrapup / tl;dr and tips from analysts

--

Part One - Introduction

If you're going to deal with analysts at all, you should know what they are and what they do. 

Although blogging and byline articles blur the lines, Analysts are not Press.  

Press may do analysis (the best do). Analysts may report on news (the worst do). But analysts are not press AND press are not analysts. Both may be pundits, though. 

Also, technology analysts are not financial analysts. Although the latter are frequently customers of the former. 

"Independent" analysts are rarely independent. They tend to be pay-for-play and rely too much on vendor cash to keep afloat. It's hard to cobble together a living as a firm-less pundit without being compromised. There are exceptions, but not many.

Many analyst firms are pay-for-play. Many will write whitepapers and "advertorials" that are underwritten by vendors. I find these (after too much experience) highly suspect and particularly worthless. But YMMV, because depending on your target audience, they can be effective "offers" that convert SEM dollars into form submissions.

Top tier analyst firms, the ones that command the highest premium and respect, tend not to do those sorts of things. They run on reputation and can't afford to tarnish it. Typically, they'll fire any analyst found to be trying to shake down vendors for cash (directly or indirectly). Or they'll fire any analyst found to be hiding a conflict of interest (e.g. personal financial stake in a vendor in the analyst's coverage area). 

What they do:

1. Provide independent analysis on technology areas and vendors and products. This includes things such as trends in a specific tech (e.g. MDM), vendor position in the marketplace (e.g. Magic Quadrants), and product fitness for particular purpose or use case or end user. This analysis is typically published in written form (and spreadsheets) and includes both quantitative (e.g. unit sales) and qualitative (trend derived from end user interaction) "research"--which frequently incorporates actual primary (the big firms have in house primary research functions) and secondary research.
2. Provide "advisory" services to those who subscribe to the research products. This is typically in the form of "inquiry" on the phone where a client will call up and ask to speak with or get routed to an analyst covering a specific topic to discuss a particular issue in depth (e.g. Can you replace ProductX with ProductY?). It can also be in the form of in-person sessions with presentations.
3. Run conferences.
4. Provide consulting services (usually an independent arm of the firm) which produce written reports and the usual high-end IT consulting work products.

Who they serve:

• Users: technology buyers-- typically the bigger end of SMB up through the largest enterprises and state/federal agencies
• Makers: technology vendors-- early stage startups through the biggest, most entrenched incumbents
• Investors: who invest in makers-- VCs, investment banks, merchant banks, private equity, hedge funds, institutional investors

How they are used: 

• Should I upgrade X or wait a cycle or bring in an alternative for a POC to use as a lever to get better license terms for the upgrade or abandon this line of inquiry altogether and let X age out before replacing it with Y from a promising new startup?
• Is it the right time to get behind trend X? What kinds of impacts will my current spread of development, operations, organization, and applications suffer?
• Etc.
• How do I prioritize these 10 features on the product roadmap and position myself best for what end user of type X sees as the gaps in all the products out there today?
• What is the right arrangement with my channel partners to get new product X into new market Y? And which partners are the right ones that hold the highest degree of influence in that market?
• Etc.
• Which of these 5 startups are likely to survive the next 2 years and make it to the point of being acquired and who will most likely acquire them and what are the competitive dynamics of big players A-D that will impinge on their success?
• How will the rise of technology X affect legacy business Y of incumbent Z?
• Etc.

Fundamentally, what analysts provide is decision support for procurement, product, and investment.*

Fundamentally, what analysts do is information arbitrage. 

Their perspective, domain expertise, and context should allow them to draw conclusions that are very hard to reach otherwise and then to present those conclusions in grokkable form to clients. 

--

Next, a look at what analysts can do for startups and how you should engage them.

*There are exceptions, such as firms that are purely vendor focused or specialize in very targeted areas (e.g. RedMonk - read their guide!).