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SEP 10, 2015 - 53 MIN

451 Group on Analyst Relations


In this Heavybit Speaker Series, Donnie Berkholz of 451 Research will offer insights into analyst coverage areas and how to present to them, context-setting for analyst briefings, and finally, how to engage with analysts on their upcoming research calendars.

  • Introduction
  • Analyst Relations With 451
    • Seeing Patterns and Reaching People
    • Getting Value out of Interactions
    • Know Your Market and Customers
    • Do Your Homework
    • Building Relationships
    • Research Agendas
    • How to Present Your Company
    • Learn and Teach
  • Q&A
    • How Forms Vary Across Firms
    • Starting on AR Without a Firm
    • Setting Your Agenda
    • The M&A Process
    • Long-Form Reports: When to Reach Out
    • Pay-to-Play Relationships
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I'm going to give you a very quick intro for those of you who aren't really familiar with these strange animals. And then we'll get more into the specifics of analyst relations, and basically how to do a good job of interacting with us if you care to do so.

There are three main reasons, three main purposes behind industry analysts and why you would ever talk to one. The first one is getting influence with the buyers.

Industry analyst firms tend to have a pretty good chunk of enterprise end-user interaction or clients. Whether it's somebody like us who's, let's say, not as well known as your Gartners or Forresters or IDCs, we still actually have quite a few end-user clients.

I was actually surprised by it. I started here four months ago. We don't have 10 out of 10 insurance companies by any means, but we might have four or six of them.

It's enough that you can get a pretty good feel for what's going on on the buy side, on the ground floor in these companies that still have things like mainframes and still make heavy use of them and develop new applications that use them on the back end.

Analyst Relations With 451

This is a graph from Simon Wardley. That is my favorite graph about the enterprise IT adoption curve in that, if any of you happened to be red-green colorblind, you may not be able to read it so well. But for the rest of you, basically it looks like they don't do new stuff ever.

Then they finally notice, when it's way too late, and pick it up. It was intended as comedy, but it turns out to be a little bit more true than one would hope. So that's the first piece, the buy-side influence.

How do you get that influence? We take a lot of inquiries from end-user clients. We talk to them about whatever problem they're calling up to ask about. It goes all across the border.

They're sitting there saying, "How do we set up a CI pipeline or something? How do we set up a CD pipeline? What should we do for service discovery?" We get a lot of those kind of questions. "How do we do this, how do we do service virtualization?"

We have to come up with answers to them. Those answers are generally drawn from our research and from our conversations with people both on the buy side and on the sell side: "What are the products? What are the features and how do they fit their use cases?" So that's reason number one.

Reason number two is, from your perspective, to basically do research. Treat us as outsourced competitive intelligence. It's generally a lot cheaper to pay an analyst firm to do it than it is to hire a full-time person to do it in your staff.

Reading the research gives you a pretty good picture of what's going on out there in the market,if the analyst firms are doing their job.

The third reason is how some of us make our money. The bread-and-butter is the consulting services. So we always try and sell you things like go-to-market, like webcasts and Hangouts and all that sort of stuff, but also on internal strategy stuff not for distribution.

What should our strategy be with this? Let's do some message testing on this thing with us playing the proxy of the buyer or of the user. That's really analyst firms in three bits.

Now, I want to get a little bit more specific into analyst relations and how to do it well. I'm not going to cite any specific examples, by request from some of the people who I've briefed with here in the audience. But I do want to talk about some of the ways you can go wrong and some of the ways you can do it right.

Seeing Patterns and Reaching People

In general, your company has a lifecycle. Analyst firms have a lifecycle. The goal is to find the best fit between those two so that you can both learn things that are useful, in terms of the patterns that we've seen in the industry, but also so that you can reach the right kinds of people when we're doing research in the space and we're writing about them.

For example, the people who sign up for Gartner Research are not the same kinds of people who sign up for Forrester Research. The same kinds of people who sign up for 451 Research are not the same kinds of people who read RedMonk Research. There's a very wide spectrum of who those people are, and there's a very wide spectrum of the kinds of companies they want to hear about, the kinds of technologies they want to hear about.

If I'm signed up for Forrester, I might be very interested in marketing technology, how I can build apps for mobile sites and that sort of thing. I might be less interested in SAP landscapes. Every firm has a different cycle, but also the key point is to find the point in your lifecycle that's right to start talking to each one of those firms.

If you're a very, very early-stage company that hasn't really taken any funding, that hasn't shipped a product yet, that hasn't found customers, there are some analyst firms that are definitely not going to be the right fit for you. Because you'll talk to them, and they'll hear you, and they'll say, "So, you do have customers? Are you making money? Do you have a business?" And it's not clear, right?

Maybe you will have a business. Maybe it'll be the biggest thing since sliced bread, because that seems to be the acquisition model for startups now; get a bunch of adoption, don't make money and then get acquired.

But analyst firms have a very different approach to the industry, because a lot of what we're doing is advising enterprise IT shops. They're not going to bet on something easily that doesn't have any customers yet.

That's one of the reasons they rely on companies like us to say, "Well, there's this company out there, and we talked to them. They seem interesting. They saw the problem we have, but they only have three customers so far. Can we trust them?"

Try and find third-party experts, beyond going and asking for references, to say what's likely to happen here based on other people's expertise, what's happened in the past and that same kind of point.

To reiterate, you've got to think where you are in that lifecycle and where you're going to overlap with the analyst firms you care about.

And not just that, but we're the individual analysts in the firms you care about because every single analyst is different. If you decide "the person I've got to talk to" is, let's say, the main public cloud analyst at a major analyst firm, that person is going to have a very particular approach to how they care about new technology, whether they're technology-driven, customer-driven or somewhere in the middle.

You have to decide where you are to figure that out. And that brings me to sort of the next point, which is, how do you hack these analyst firms? How can you get the best possible value out of talking to these people?

Getting Value out of Interactions

For our report process, we have a very specific template we follow. If you know what that template looks like, you can actually tailor the way your briefings work with us. This is just a little snippet of it, that's not an encyclopedia, but it doesn't have to be.

If you're able to get access to the research library of an analyst firm, you can say, "Alright, in this analyst firm, their reports have, let's say, three or four out of eight possible sections every single time.

Which of those sections do I want to appear in the report about me? Do I want to talk about customers and sales? Do I want to talk about my technology platform? Do I want to talk about my product? Do I want it to talk about my vision and my strategy?"

You can actually tailor your briefings very specifically to say, "Alright, here's what I want to reach this audience right now. What kind audience am I trying to reach? Are they going to be early adopters that care a lot about technology? Or are they going to be a little bit more 'risk-averse' people?"

If you're one of the companies that's a little bit later-stage, and you've gotten, let's say, 100, 200 customers, you can start to reach a different audience than if you're trying to search for your first five.

Knowing what their report formats look like means that you can tailor what you say to what you want to be written about, so that it reaches the kinds of people you're trying to reach.

Like I'm saying, this is an example of ours, but every firm has a little bit different one. Some of them are long-form, some of them are short-form, and I think we'll get into that pretty shortly here. How does that all come together in the bigger picture? Which is, basically every analyst firm of size has to figure out what its analysts are going to focus on.

Even 451, we've got about 100 analysts now. Gartner has an order of magnitude more than we do, and everybody else is somewhere in the middle, except for very focused firms that might be smaller.

The most important thing to do if you're trying to figure this out is you want to have that end-user influence, you want to be able to get to those buyers. How do you do that?

Well, you have to be talking to the right analyst, and you have to make sure they classify you in the right way. Because they're all trying to figure out where you fit into their view of the world.

Something worth mentioning here is a lot of startups in particular really like to say, "We're the first company ever doing something," which is actually a huge red flag for us.

Because when we hear that you don't have any competitors out there, we feel like, chances are, there's not a market out there.

And you may prove us wrong. It happens. There are those disruptors out there who have done something brand new, but there aren't going to be analysts betting on them until they've already proven it's going to be a success.

Know Your Market and Customers

One of those things, like the sections I was talking about in our reports, and the things you'll hear from almost analyst you run into is, "What companies do you run into out there in the field? What are your customers' winning deals from?

"What are they switching from? What do your wins look like with your sales force out there? Are you competing with Atlassian? Are you competing with IBM and BMC? Are you competing with CircleCI and Travis? What does that look like?"

If the answer is, "Well, we're competing with do-it-yourself, and that's it," it actually increases your burden to prove that you've got sort of a viable business model there, which you can always counteract if you've got the customers to show it.

Customers trump everything for most analysts out there because we've got to be able to make the case to our audience, that this is a technology worth paying attention to.

The best way to make that case is with the dollar signs. To go back to the original point here, you want to make sure you're talking to the right analyst who cares about the right kinds of things.

Basically, all of us have some kind of taxonomy that we have to fit things into, and that may be for internal use, it may be for some kind of publication. One of the things we do is have these things called market maps where people are trying to figure out, "What even are the companies in the space?"

I know I have to do this thing, and I have no idea what they are, and so we publish sort of a guide that puts them in the right spot. Every other analyst firm has something along those lines and has some kind of shape-based ranking, usually with four sides. You can take your pick as to whether that's a Magic Quadrant or a wave or we've got one, whatever.

All of those rankings go back to something behind them. Whether you happen to agree with them or not, whether you happen to think they have merit or not, the fact is that conservative IT buyers do think so. You have to figure out how to cope with that. And the best way to do so is to figure it out, talk to the analyst about it, talk to the firms about it.

Do Your Homework

In nine out of 10 cases they publish all the information you need, and nobody ever reads it. Companies publish, like, "Hey, here is exactly how we do this evaluation process. You can run through every single question on there, and you should have a prepared answer that sounds good." I mean, it's not a difficult process.

It's just about putting in that effort and to prepare for it, which a lot of startups don't realize. These resources are even out there, which is what creates one of the challenges.

All you have to do, just like anything else, just like trying to make a sale, is you have to do your homework.

Ironically, it will actually turn out to be the opposite for the analyst. They'll often show up at your meetings having no idea what you do, no idea what your company does. Because somebody else books the meeting for them and said, "Oh, I think this is relevant to your interests."

For example, right now I'm here for VMworld. I have about 30 meetings over the course of two days that were not set up by me. They were set up by some of our sales reps and support reps and so on. So I keep showing up for these things saying, "All right." In some cases, I haven't heard of those companies before. I don't know what they do.

My chance to do research is the two minutes I have walking between those meetings, and that's the first time I've heard of them, especially the earlier-stage it is, the more likely it is that I'm not familiar with what they're all about.

That makes it all the more important that you've paid attention to what they are about because they're not going to know what your message is up front. So you have to do the homework, unfortunately, on your side to say, "Alright, this Donnie guy, you know what he cares about right now? He cares about continuous delivery. He cares about micro services. He cares about Docker."

We have to figure out where our message fits into that stuff. It's not just about the single, over-arching message of what your company is that you put out on the website.

It's about tailoring that message individually to every analyst you're talking to.

They tend to have outside influence, and I'm not saying this for myself personally, but especially the larger the firm gets, the more influence the individual analyst has. And so having that meeting with the analyst might be the equivalent of having 100 customer meetings if you can get into their report, if you get onto their quadrant, because that's how many readers they have who care about what they're saying and who are trying to make a decision on technology.

Then we get into some of the more shady territory, let's put it that way. There's a broad spectrum of ways to influence analysts, some of which work a lot better than others, and some of which have a lot more ethics to them than others. I leave it up to you to decide which route to take with yours.

In general, the best way to go about these things tends to be: one, you do your homework, figure out who the right analyst is; two, you start interacting with them; three, you start pointing your customers their way so they can interact with them as well; and four, they get to a point where you've got a direct relationship with the analyst. They start coming up with questions and then you're very easy to reach.

They get an inbound question about simple monitoring, for example. And who's at the top of their mind but the person they've known for a while and who they just had a briefing with about monitoring.

Take your pick of any startup in this room, certainly for those of us who are covering development of software, we get questions on a regular basis about how to do this stuff. And the goal for you is to always be top of mind.

It's not always the case that we're going to sit there doing research, be it the last five years of our publications, to answer one inquiry. But what we are going to do is, I always have a list on the top of our heads of companies we think are solving a certain problem really well and that are worth considering. There's always going to be things that we do that are going to involve intense research.

A lot of times, especially larger clients who are coming to us and say, "Alright, can you segment this market out for us so we can figure out what to buy for our very specific problem? Can you recommend exactly the implementation pipeline you would choose, the SI to template it for us, all the way down?"

In a lot of cases it's not that extensive because, it turns out, that costs money, because it takes time. And people are just looking for us to spend half an hour thinking about it and then working through it with them, working through their problem and saying, "Here are, let's say, the three or five vendors on the top of the list who come to mind when we're thinking about your problem."

Building Relationships

A lot of that has to do, as I was saying, with the kinds of companies that we have good relationships with. So we're thinking of them instantly. How do you get to that kind of relationship? One of the best ways is in person, as it has been.

Analyst relations tend to be one of the vestiges of that old sales model, of like, "Hey, let's hang out and go play some golf or something."

It turns out we have one of our conferences in a few weeks, and we actually have a golf tournament beforehand, of all the ironies in the world. But relationships remain very important.

For everyone of you out there, that's going to be a small number of them. Because every firm is going to have probably one, maybe three, analysts who are highly relevant to your area. They might be speaking to different kinds of audiences on their side, maybe there's one for CIOs and one for engineers and engineering managers, but it's a very small number people.

It's not like this is some immense burden. But it is immensely important that you figure that out. So, how do you build those relationships? It starts out with things like briefings and conferences.

The easiest way to get their time is to figure out where they already are. Just get on their schedule when they're there.

Whether that's in conferences, whether you happen to be in their city for some reason, one of the best ways to get me to come talk to you, for example, is to say, "Hey, I'm in Minneapolis. Can we meet up and grab a coffee or a beer?" And I'll say, "Yep, if I'm there," which I am about half the time.

But that's generally true, because all of us travel a lot, and so if there's any reason we don't have to travel for a meeting, it makes me really happy. It gives me an instantly positive impression of people if they're here and I don't have to really work very hard at it. So, industry events. Being in their city.

A third one, and one that requires more investment is most analyst firms have their own conferences, too. They'll try and get you to show up, get you to sponsor, get you to show up in some kind of a panel or have a booth or something, and at a certain point, that becomes a very useful investment.

That point is not now for most of you, if you're still in this building. If you've moved out of this building, then it might start to be a point that's interesting. Once you start running into difficulty getting traction with, let's say, Fortune 500 companies, suddenly you think, "Well, how do I reach those people?"

It's through peer networks and through trusted recommendations. Whether that's through some of your customers that have already picked it up, or whether that's through analyst firms, that's the best way to go about it.

A fourth way, and probably the cheapest way, is just using Twitter. Most analysts now, at least the ones that are paying attention, are active on Twitter or active on LinkedIn or both. As much as we like to make fun of LinkedIn in the tech community, most all of us are on it. Many analysts are active on it, even those that are not active on Twitter yet. So it's a very easy way to reach these people and start connecting with them and saying like, "Hey, I've got a product that I think is relevant to your interests."

For me, I would much rather hear that coming from an officer of the company than a PR firm. It instantly generates more credibility for me if I hear that one of you in the audience right now says, "Hey, I started this company up. We're doing something, I think, is pretty cool. I looked into your coverage and it seems like it's pretty relevant. I'd love to tell you a little bit more about it."

It's different from sales in that you're not competing for dollars, you're competing for time.

That ties into one of the later points I'm going to make. Timing is really important for a lot of reasons. One of the first things that we get asked when people, who have been doing analyst relations for a while, talk to us is they say, "Do you have a research agenda? What does it look like?"

Research Agendas

Research agendas, how many of you have heard of these? Maybe 10 percent of the audience? So, most analyst firms have these things called research agendas. They basically lay down what we think are going to be important trends for the next year or so and what some of our publication schedule looks like for some of the bigger reports.

Because some of us sell research as a business model, that requires that we build in some kind of expectation of what we're going to deliver. And so we have to schedule some kinds of reports pretty far out. Right now, I am writing up an agenda for, I think it goes through Q3 of 2016, on the kinds of reports I'm going to be talking about.

As you can imagine, those are pretty high-level topics at this point, because I don't know what's going to change between now and then. But if you can get on to their schedule right around the time they're going to be writing up a long-form report in your area, you can imagine, it makes things a lot easier for you to get published in some form or another. Whereas if you try and get on their schedule when they're writing one of these reports about some other area, it conversely makes it a lot more challenging to get on their schedules.

For example, at this very moment, I am writing up a report on CI and CD. So if there are any CI and CD companies that want to talk to me, I'm like, "Yes, please, right now." I have no time on my schedule at all, but I will create time for them.

Whereas, "Docker? Well we just published that. OpenStack is going to be in coming out in a few weeks." And so it's not at the top of my mind to start taking briefings from those kind of companies.

Getting the timing right is really important to this. And it goes to research agendas.

Another key aspect of this is conferences seasons. Analysts tend to travel a lot, and so if you're talking to me between about February and June, or between about a week ago and Thanksgiving, I'm going to be traveling every week.

Getting on my schedule tends to be really hard, and I'm a lot more likely to say no. And this isn't just me. I'm just speaking as a personal anecdote. This is true of everybody I talk to, because it's how the analyst industry tends to work. It's kind of like a traveling circus.

The same group of people shows up at every conference and just goes around the industry. And we run into each other every single time.

I mean, especially once you start talking about more specific markets, there's about five or so analysts out there who care about developer-focused software. I see them everywhere I go. When there's a conference I go to that I don't see them, I say, "Yes, I'm doing my job. I'm finally somewhere where these other people are not, so I can add some unique value to this industry, into this conversation."

There's a very small amount of people that are traveling all the time to all the same conferences. If you can figure out the conferences they're going to, you can try and meet them there. I'm meeting a lot of people while I'm here who are not actually attending the conference. They just happen to be based in the city, realized I was coming, and pitched me with the right timing. And that's generally true of anybody.

We've got conference seasons, we've got research agendas, and we've got consulting seasons. All of our clients have consulting time to use. A lot of them have fiscal years that run through December, and so, guess what our December looks like? A lot of consulting work. Again, we're distracted from writing the research up.

Now you've broken it down. You're like, "Alright, what months are left?" We did February through June. We did September through November. December is out now, okay, so, January. That's our month. January and July. Because by August everybody wants to go on vacation.

You break it down to say, "What months are really good to reach analysts?" It's January and July.

The rest of the time, it works. But if you're trying to reach people who: one, don't know you already; and two, don't know if you're super relevant to their area, and you just want to try and get to the firm and try reaching out to as many people as you can, those are pretty good months to do it.

How to Present Your Company

I think one of the really important things, especially when you're reaching out for the first time, is to really have to think about, "How do you tie in to the industry trends that are happening out there?"

Once you've managed to figure out who the right analyst is, this is probably the second most important thing in that you're able to say, "Hey, I'm a part of something bigger here, and so the reason you should be writing research about us is that we're illustrating what continuous delivery looks like in the enterprise."

Or, "We're illustrating what infrastructure version control looks like," or I'll just start picking the pitches off of every company in the audience here. But that's really important, to tie yourself in. Because whenever I get a pitch, and I get a lot of pitches, every analyst gets tons of pitches in our inbox, I read it over and I say, "Have you said a word that I care about?" Half the time, the answer is "not really."

You've said a lot of stuff. You see every press release. There are journalists, some outlets that republish the press releases, basically, and a lot of times, I'll read through those, and it's very unclear to me what actually happened to generate that release. What was the announcement? I'm not sure.

They're synergizing and leveraging and moving the industry forward and transforming their clients. And I'm done reading that, and I think I throw up in my mouth a little bit.

I have no idea what actually happened in the statement. All I know is it was written by a committee of people, all of whom managed to factor out every single gram of opinion in it. So, if you can manage to avoid that and start pitching people on things that hit their trigger words. I talked about some of the ones for me earlier, every analyst has their own. It's pretty easy to find them.

You can either go look up the abstracts of the reports they've been writing, or you can go look up what they've been saying on Twitter, what they've been saying on LinkedIn.

It's easier now than it ever was to figure out what people like this care about. And then you just have to make sure you're not blasting these pitches out to every analyst in the industry. You're going to get a lot better return if you're able to target these things than if you just shoot one out everywhere.

I just had dinner with one of my favorite PR people last night, and she is one of my favorite people because every single email I get from her is super relevant and written for me, understanding my interest and what I care about. And she understands me well enough to know that if it's not an area I care about, she doesn't waste my time in the first place.One of the biggest problems I've got right now is the inbox that doesn't end. I mean, I literally can't get to all my emails.

The second piece of that, which I talked about a little bit earlier, one is friends, and two is competitors, right? If you can tie into companies that they care about, then that'll make you all the more relevant to them. I mean, there aren't many companies that go so far as to do this, but if you say in a pitch, "Hey, we're challenging VMware for the top spot in the space," or "We think we've got something that's going to totally disrupt them, it's going to be crazy," that instantly catches my interest if that's a company I care about.

When I care about certain companies, I care about everything that's going to be a threat to them, too. I've talked to some about the end-user clients at the beginning of this, but a bunch of our clients are also software vendors, and they're always coming to us saying, "Hey, what's going on out there in the field? What are the threats to us?" They want to know about companies like you.

At the same time, that gives you a free inroad to get at those kind of enterprise buyers. So that is high-level how to get at industry analysts and how to do analyst relations pretty well. The main take-homes are: understand where you are in your life cycle, understand where analyst firms are in their life cycles, and try and create that match between you, the analyst firm and the analyst within the firm in terms of bias toward technology versus bias toward customers.

Most importantly, especially for the customer-focused analyst, is you don't want to be out there doing all of these crazy pitches, giving them this first impression where they think, "Oh, well, you're just kind of playing around over there. You haven't done anything yet. Why are you talking to us?"

Then you're going to want to go back to them, let's say, a year later after you've built something really cool. And they're going to say, "Oh, I heard of you. You didn't do anything. You raised a bunch of money and then what?" The first impressions can be a major problem.

Learn and Teach

The second take-home is learn and teach. When you do get the briefing, analysts are a good opportunity to get some free knowledge about what's happening with competitors out there, what kinds of trends might be happening in areas that you're not paying any attention to that you could benefit from. Just by asking them, throwing some of their trigger words out.

It's very obvious to me when people are trying to get free advice. But if you can throw something out and say, "Here's what we're seeing in this space," a lot of times, analysts will volunteer what they're seeing in the space. Whereas, if you start asking me for stuff, it's very different, and I start to feel stingy about talking.

But if you share things with me, I'm a lot more inclined to share things with you. This goes back to that book cover that I showed a few slides back, Robert Cialdini on the five big factors behind influence. One of the big ones is reciprocity.

Whenever you can generate reciprocity, it's a subconscious influence on that analyst on them giving something back to you, whatever it happens to be.

I think this is the whole philosophy behind trying to take people out to dinner and that sort of thing. Actually, the example in that book, which I really enjoyed was, remember the Hare Krishnas in the airports?

They always handed out flowers and stuff. They hand out a flower and then ask for a donation, because they found that their conversion rate was way higher if they started handing out flowers than if they just did nothing. Same philosophy holds true for everybody, even if they don't realize it.

That's why if you want that opportunity to learn something, essentially learn it for free while still trying to influence, try teaching first. Say what your view is of the industry.

Most analysts don't want to hear about the market they feel like they cover. Because they're pretty confident, they already know it, and they don't want you convincing them they're wrong about it. But if you can start talking about some interesting adjacent trends, then you can pull their trigger and get them talking about stuff.

The third big take-home is it's really, as unfortunate as it is, it is really about relationships. So much of it is about getting to know those people well, so that you're a resource they reach out to when they have questions about something, and you're on top of mind when they're thinking about recommendations.

For example, right now one of my coverage areas is monitoring, and there are 86 companies on my matrix of monitoring companies right now. That means every time I have any kind of complicated question, I've either got to go look up that matrix or say "Here's the three or four I think of off the top of my head.

I'll probably get three quarters of the ones that are relevant to their interests in the answer, but there'll be someone missing. Chances are, the ones who are missing are the ones I haven't talked to recently. So it's really important that once you find the right analyst, pitch them, target them and start building that relationship that you keep doing so frequently.

Generally, every time you do something interesting, I want to hear about it. Because we like to be in the loop on stuff. Because half of our goal is to sound like we know what we're talking about to our clients. And so we want to know what's new so that we can share it with them and look like we're smart. Anytime that you can make us look smart, that's going to work out pretty well for you.

I guess the flip side of that is if you want us to have that kind of reciprocity. Obviously, help us out, just like anybody else in the world. If you can make me look good, and this is actually the root of why you go to a lot of conferences and so on and they tend to keep quoting things from analysts. Sometimes there are things that add questionable value to what the talk is actually about. And in some cases, there are those end users who are interested in that sort of thing.

It's just trying to generate some feel-good there. I mean, I was thrilled recently, every time I get quoted in a conference keynote or something. One of the ones that happened recently was at the Gophercon. They put up a graph I made on the growth of Go over time, and I was like, yes. I'm winning right now. Rob Pike is talking about me.

This feels like I've just done technology right. And did he really need to convince the attendees at a Go conference that Go is a big deal? Probably not. They're already there, they've already bought into it, but it sure makes me feel good. Everything you can do like that.

There's actually a book I was reading recently that you might be interested in checking out on analyst relations called UP and to the RIGHT. I forget the author off the top of my head, but it's worth checking out. It's actually pretty cheap on the Amazon.

He makes all kinds of interesting recommendations, some of which I agree with more, some less. Many of them are not applicable to small startups because they involve things like bringing in analysts for a strategy day that costs you lots of money.

But some of them are, and those are the things like generating that kind of reciprocity so that they want to give back, so that you're top of mind. These are some of the most important things on AR, and I'd be happy to take any questions you have at this point.


How Forms Vary Across Firms

The ones I know best, having worked with both of them, are RedMonk and 451. Both of which are probably some the more relevant ones, too.

RedMonk is very free-form, right? We can write whatever we feel like in whatever format we feel like at whatever pace we feel like. You don't want to talk about research agendas and those sorts of things. That happens once a company has had to scale and formalize the process a little bit, because it's a more involved sales cycle and large deal sizes and so on.

At RedMonk, for example, if you're targeting one of them, you don't have to really think about the research agendas. But things like conference and consulting seasons are still incredibly relevant. Things like what's in the report depends very highly on the audience of the report.

For RedMonk, they're writing for practitioners and only practitioners. The business model is they make money off consulting, and the research is free. Because the research is free, they get very broad reach.

They get lots of developers, lots of ops folks reading the stuff who would never have signed up for a paid subscription at any firm but who are happy to read interesting technical content for free, or semi-technical content. Let's say numbers about business of IT, for example, numbers about language adoption, that kind of thing.

There's no formal report classes, report sections there. But because it's a very technology-focused audience, the reports tend to focus a lot on technology too. Because who are you writing for?

That's why one of the things RedMonk does is a programming-language rankings. Every developer wants to know what language is the most popular, and hopefully, it's one of theirs. They get enormous numbers of traffic coming in, and so that biases the approach to focus even more on technology.

If you were pitching RedMonk, certainly if you're pitching the people at RedMonk that tend to write very technical stuff, pitch them on tech. Their reports are all freely available, so it's easy enough to go take a look at what they've been writing about and say, "Oh, here's your interest areas right now. What are the last five things you wrote about? It was: DevOps, Spark, monitoring, Silicon Valley tech bubbles."

Pick your topics and target your pitch appropriately. Whereas even without RedMonk, it's a pretty tech-focused firm, but everybody's a little bit different. And so, it's easy enough to tailor your pitch, but my guess is more technology biased.

Whereas if you look at 451, we are more business-focused because the research is proprietary. And so you have people with enough money to buy access to research, signing up for the stuff. I think it's about a third finance people, so buy-side and sell-side bankers, corporate development, VCs. That's a big chunk of our audience.

We get another big chunk, that is vendors of varying sizes from, I don't know what the smallest one is, but it's probably under 10 people, up to tens of thousands or hundreds of thousands of people. There's a small number of companies there, and I'm pretty sure you can figure out who they are.

And then the buy side, which is the other third of the audience. Those tend to be, again, people high enough to have enough budget to spend on these things, who are trying to make buying decisions and trying to make implementation decisions. So that drives the kinds of focuses we have.

We have different types of research for different types of those audiences. We have things that are like implementation reports of, let's say, "GE bought some technology and did a thing with it, here's how it went for them."

Or a guy in my team just wrote one about Yelp, which implemented its own Paz from scratch, using Docker and Mesos instead of picking one off the shelf. People are super interested in that if they're implementing technology.

Whereas every time a vendor gets acquired, we write up a deal analysis, and all the bankers and everything are all over that stuff. We're very focused on finance for those. And for that third audience, people doing competitive intelligence of any form, or people trying to make vendor-selection decisions, those tend to be focused on a number of different areas. And it kind of depends on the briefing, and that's the one where you really have a lot of flexibility to influence what's written about it.

What do the sections tend to look like? There'll be something that looks like company background, which will be like, "How long has this startup been around? How many employees does it have? How much funding does it have?"

Then there'll be something about the technology platform, just kind of a walk through the details. Or it could be something about the product offering. "What does it look like? How is it packaged? What is the pricing?"

There'll be something on sales and customers, like, "What it the sales model? What's the business model? How many customers do you have? What's the average deal size, if we can get it?"

There'll be something potentially on partnerships. There could be something on vision and strategy. There is, in ours, universally a section on competition and, having a sense of what those eight sections look like, they won't all show up in every report.

There will usually be maybe four of them in every report, and so you can structure your briefing to say, "All right, we want to push tech here because we feel like that's what our current buyers are going to care about." Or, "That's what we're doing. That's really distinctive."

Or maybe another company might feel like its channel model is very distinctive, and so they really want to focus on partnerships and on how they're getting the software out there, because they feel like they've got this brand-new channel compensation structure that nobody has ever seen before, and that's what's going to get them scale.

So you can use bias, like I said, to get to whatever you want to. The same is true for the other analyst firms. There are only so many different ways to write about company. The bigger the analyst firm, the more customer-focused it tends to be.

My understanding of some of the large ones is they'll do things like ask for 25 to 50 reference customers to go talk to you about something. Then they'll just go talk to them and basically try and distill that into trends.

For example, if you don't have 25 to 50 customers who can be referred to an analyst, and that's what they're looking for, that's going to create some problems when you want to be in their rankings. Because it's just not going to happen.

Starting on AR Without a Firm

There are, in fact, analyst firms for analyst firms. There are a couple of them out there. They do things like do surveys of the analysts.

Analyst relations departments at really large vendors will conduct regular surveys to see if they're actually doing their jobs as analyst relations departments. They say, "Are we making influence? Are we changing analysts' perceptions of things? Do they think of us? When do they think of us? What kind of trends come to mind when they think of us?"

There are firms out there that do that sort of thing, and they, in part, do it to help AR people keep their jobs. They, in part, do it to help support analysts out there in being able to say, "Analyst firms are great. We just did a survey that proved it."

Then some of that survey goes to end users, and end users are able to provide input on, "What firms do we go to when we're trying to solve these kinds of problems?" And so there are analyst firms for analyst firms.

I think of two or so of them out there right now. One of them, I think is called KCG, Knowledge Capital Group. There's another one, I can't remember, that's like analystrelations.org. There's an institute for analyst relations people, and they do all kinds of rankings. Some of them show up on Slideshare, so you can go check it out.

Secondly, almost every analyst firm publishes a directory of all its analysts and what they care about, what kind of topics they cover. The research library is closed, so that's not going to show up in a Google search if you search their site. If you search their site for topics that feel like they should be your market, there are probably going to be a limited number of analyst who show up.

Then you can go from there, read the bios and say, "Okay, I'm not sure." I've gotten down to the three analysts that might be my area. I'm not quite sure at that point. I think it's reasonable to reach out to them directly and say, "Hey, here's what I do. Here's what my company is about. Would you be the right person for us?"

Oftentimes, they turn out to be the right person. If not, they'll generally refer you to whoever is, because they're close enough to the space. They'll be able to say, "Hey, that's my colleague Chris. He's on my team. You're really close, nice job. Thumbs up."

And then the other way to approach it, you can do the Google search results, see what happens. I can't speak for every firm, but ours is set up in a series of research channels for different areas. It's like a mobile channel and a development channel and a data-platforms channel and that sort of thing.

We have a webpage that lists all the channels, lists what the channels are about and lists every analyst contributing to that channel. You can pretty easily work your way down a funnel saying, "Alright, so we do development stuff. Let me check out that development channel and see if that's my thing."

Let's say the description feels about right. They've got a link to their research agenda there that really feels right, and they've got four analysts listed. You can click through the bios and say, "Alright, so this one is about EPM management. Nah, not really my thing. This other one is about private cloud. Not exactly my thing. This one is about containers. Oh, that's me."

Those are the two ways. It's the phone directory route and the Google route.

Setting Your Agenda

In our case, and I think this is true of other firms as well, we publish a research agenda. It's available for free to anybody who wants it, clients or not. In that agenda we talk about the issues we care about, and then at the end of it we put our schedule for the long-form reports. They're all there.

We say, "Hey, in September we're coming out with CSCD. In October, it's going to be this other thing. In February, it's going to be micro services.April is going to be Docker. July is going to be OpenStack." Whatever.That tends to be part of the research agenda for those long form reports, what's coming up.

For the short-form reports, that tends to be a lot more up in the air, at least in our case. It could be more structured at other firms, I'm not exactly sure. I haven't had those conversations at any conference bars at this point, but I'll be sure to ask next time I see them.

The short-form reports tend to be more about what fits into my schedule at that point in time than about being super predictable. Every analyst is a little bit different there, so that's worth asking them individually.

A guy on my team, Jay Lyman, tends to like writing about things in clumps. And so he likes to write about all the config-management vendors in the span of two months, write about all the Paz vendors in the span of two months and keep moving on through different areas within his coverage.

In our case at least, it's just a matter of what you prefer personally. I'm kind of more sporadic and ADD, so I write about all the backlog of my stuff that I still haven't written about, versus trying to say, "Hey, this is Paz month."

The M&A Process

We actually, and other analyst firms as well, do due-diligence work with corporate development, as well as with VCs.

They'll come to us saying, "Hey, we're talking to company X." I just did one last week. "Will you do a briefing with them with us on the line so that we can hear the kind of things that you're asking about to indicate where they fit into your space?"

Then we'll have another conversation after the fact where we'll talk directly with the VC or with the other people, and they'll basically say, "Hey, are they for real? Do you agree that this is even a thing here? Can you support that with some data so that you're not just saying everything is great all the time and it's gravy?"

We absolutely, and other analyst firms as well, do have those conversations. And they go in a lot of different levels of depth, from that high-level qualitative stuff to much more data-driven work.

We can do extensive segmentation, market sizing, all kinds of that stuff to support their decisions on whether to acquire companies.

Long-Form Reports: When to Reach Out

I think it's always better earlier than later to reach out to them, certainly with the interests of understanding what the right time is to reach back out. Because you can always be too early, but being too late doesn't help you at all.

I would tend to reach out and say it's going to depend a little bit on what that agenda looks like, because you want to reach out after they've finished the one they were just working on but before they've really gotten into the next one.

A lot of times some of these reports can be rather cyclical in nature. For example, every nine to 12 months, in fast-growing areas, we'll update a report and say, "Here's where things are now."

This is the second or third time we're doing an OpenStack report. We just did a containers one, and it's going to come out again next March or something, because things are changing so fast. With those kinds of reports, any time is the time.

But then with the one-off reports, all you can try and do is say, "Hey, I looked at the research agenda for this group. It looks like these are the ones you'll probably be involved in, and I'll try reaching out to you after I think the last one you were involved in is done with."

There's a little bit of a guessing game, and the only way to really answer that better than a guess is to reach out to them and ask them and say, "Hey." That's never a question that I mind, "Hey, when do I talk to you to make sure that we're having these discussions at the right time for this report that you're going to be writing?"

The reports, they actually vary a fair bit. Some of them try to be a lot more conclusive than others. Sometimes we're trying to say, "Here is every single person involved in the space."

So we really want to hear from everybody involved. Sometimes it's more highlights, in that if we don't hear from you, we're just going to move ahead anyways. Those are the ones where you really want to make sure you're on their list, because otherwise, you can just get left out entirely.

Pay-to-Play Relationships

I can't speak for every analyst from out there and where they fit in. But for us, we are very distant from, "Who is a client and who is not a client?" I don't know who's a client.

We've got enough clients that I can't keep track of it in my head. I'm doing a briefing with your other client. I don't really know. The only way I know, in a lot of cases, is me personally making an effort to explicitly go and look that up in our sales force and say, "Oh, you're a client."

But even then, I don't know how big of a client they are. They might be a tiny little one. They might be paying six or seven digits, I have no idea. So the pay-to-play relationship is generally really small. I mean, there is no explicit relationship there. There might be an implicit one that's largely dictated, not by pay-to-play, but by staying in the top of mind for people.

Like I was talking about earlier, one of the best ways to get analyst tweeting about you for a couple of days is to get them at your conference for a couple of days. Because that's all they're going to have to do, especially in the cases where the Internet access is so sporadic that you can't get high-bandwidth tasks done. They're sitting there like, alright, so the phone works. I guess I'll be tweeting then.

So yeah, pay-to-play, I would say, there is no explicit thing there. Sometimes, things happen by accident. For example, I was just reading in this book, UP and to the RIGHT, the author said, "Hey, Gartner has worked very hard to fight this perception in its Magic Quadrant in recent years, and what they've done is they created an office of the ombudsman for people to complain to."

Which is another one of those things that you wouldn't know that existed unless I was sitting here up on the stage telling you, "So, talk to the ombudsman at Gartner about how you feel about your Quadrant placement." But it turns out there is such a thing.

Pointing out that fact was preceded by the story about a company that sued Gartner about its placement on the Magic Quadrant, and apparently lost, because they said, "Hey, this is us doing research here."

I mean, pay-to-play, like I said, it's more about what's on the analyst's attention, what's dominating their attention for various reasons. Some of that can be relationships.

I'm sure you've seen open-source mailing lists or other mailing lists. There are people who just don't shut up and keep talking and talking and talking until nobody else wants to argue with them anymore. And I would say that analysts are just as human as everybody else.

At some point we're not going to tell this to our clients. We're not going to say, "Recommend whatever software this is because their AR people are so great at arguing." But they might get more briefings because of it.

I'll say, "Oh, how do I get them to stop bothering me?" When it's a company I do have to care about, I can't just filter that email away. "Oh, I guess I'll just be taking briefings a little bit more frequently than I otherwise would."

That's one of those, maybe intentionally, maybe not so, but sort of shadowy AR tactics that I would not at all recommend. Because yeah, I'll be taking briefings to be top of mind, but I'm not going to be thrilled about it. I mean, that's going to be me greasing the squeaky wheel.