Free Market Research for Entrepreneurs

David Teten
Teten.com
info @ teten.com
1-917-355-5726
New York, NY
© Teten Advisors, LLC 2008. More at Teten.com http://www.flickr.com/photos/23912576@N05/2962194797/
 Interviewed over 125 Private Equity and Venture Capital Funds for
Study on Best Practices in Identifying Growth Companies

© Teten Advisors, LLC 2008. More at Teten.com Evalueserve, Ltd. © 2008. All Rights Reserved.
 Definition of Market Research

•Market Research is the systematic, objective collection and analysis

of data about a particular target market, competition, and/or
environment.
•It always incorporates some form of data collection, whether it be
secondary or primary research.

© Teten Advisors, LLC 2008. More at Teten.com http://www.marketresearchworld.net/index.php?Itemid=38&id=14&option=com_content&task=view

 David Teten Biography
• Currently: Acting CEO of Attendees.com; Advisor to DanceTimePublications.com;
advising several other startups and private equity funds
• Managing Director, Evalueserve, through September 2008. 2,500-person research firm.
• Founder and CEO, Circle of Experts (investment research firm), sold to Evalueserve
• Founder and CEO, Teten Executive Recruiting, sold to Accolo, #42 on 2007 Inc. 500
• Founder and CEO, GoldNames, domain name investment bank, based in Israel
• Technology M&A, Bear Stearns
• Lead author, The Virtual Handshake: Opening Doors and
Closing Deals Online (TheVirtualHandshake.com)
• Harvard MBA, Yale BA
• Contact: info @ teten.com

© Teten Advisors, LLC 2008. More at Teten.com

 Why Private Information About Opportunities is More Valuable

Customers pay
Sweet spot of high prices
Ability of highest returns
entrepreneur
to exploit
opportunity

Customers pay
low prices
Info is Private Info is Public
Few Competitors Many Competitors
© Teten Advisors, LLC 2008. More at Teten.com Inspired by Robert Bruner, Applied Mergers & Acquisitions, page 186
 Investment Search Process (# Companies)
Highland TA Angels on Typical
Capital Associates Angelsoft Entre-
Acquirer/Investor (2008) (2006) (2009) preneur
Profiled Initially - - 22,312 3
Targets selected 10,000* 8,000 1,584 -
Met 1,000 750 1,034 -
Negotiated with - - NA -
Detailed due - - 555 2
diligence
Acquired/invested 10-20 10-12 440 1
•Business plans received
Highland data: Economist, Global Heroes: A Report on Entrepreneurship, March 14, 2009, page 9.
TA Associates data: The Big Issue: Deal Origination, Corporate Financier, October 2006
Angelsoft data: Website, Fall 2009.
© Teten Advisors, LLC 2008. More at Teten.com
 Why Do Market Research

• A survey of small business managers in Texas revealed that

84% of those who conducted formal marketing research projects
in the past three years felt that the information obtained was
worth the money spent.
• Overall, 58% said that they were able to incorporate the
research findings into their decisionmaking process.
• Only 6% reported that they were not able to implement the
results.

© Teten Advisors, LLC 2008. More at Teten.com http://extn.msu.montana.edu/communitydevelopment/pubs/mt9013.pdf

 Market Research Process

1: Define Marketing Problems and Opportunities

2: Set Objectives, Budget, and Timetables
3: Select Research Types, Methods, and Techniques
4: Design Research Instruments
5: Collect Data
6: Organize and Analyze the Data
7: Present and Use Market Research Findings

© Teten Advisors, LLC 2008. More at Teten.com

 Search Hacks

• Filetype:pdf
• Filetype:ppt
• Archive.org
• Books.Google.com
• Slideshare.net

© Teten Advisors, LLC 2008. More at Teten.com http://flickr.com/photos/neilt/2517652/sizes/o/

 Network Valuation Formula
Ch = Character
Co = Your Competence
R = Relevance of the contact
S = Strength of your relationship
I = Information
N = Number of people
D = Diversity

N
= D * ∑ (Chn*Con *Rn* Sn*In)
n=1
© Teten Advisors, LLC 2008. More at Teten.com David Teten and Scott Allen, The Virtual Handshake: Opening Doors and Closing Deals Online (www.TheVirtualHandshake.com)
 Organizing / Speaking
at Conferences

• Alumni organizations
• Meetup

http://www.flickr.com/photos/programmerman/2315566040/sizes/l/
© Teten Advisors, LLC 2008. More at Teten.com
 Learn from Others’ Mistakes
• Ex-Employees

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 Gated Communities for Executives

• IERGOnline.com
• Executive-Forum.org
• INMobile.org
• Sermo.com
• LinkedIn
• Xing

© Teten Advisors, LLC 2008. More at Teten.com

 Interns
• Business Schools
– Columbia Business School
Small Business Consulting
Program
– Levin Institute JumpStart
• Colleges
• Student Special Interest
Groups

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 Your tax dollars

• Public libraries
• Your university library
• Interns’ libraries

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 Customers

• Observe customers in action

• In-depth interviews
• Snowball sampling
•Ask for referrals to
potential buyers to build
a sample
• Online surveys
•Surveymonkey.com
• Bleeding-edge users

© Teten Advisors, LLC 2008. More at Teten.com http://www.flickr.com/photos/superrabbit/319538167/

 Sample Market Mapping Approach Used by Growth Investor
# Stage Example
1 Identify global trend Aging population in developed countries

2 Implication for specific Finance industry: growth for financial services providers
industries of interest with low-risk investing products
2 Implication for specific Japan: need for low-wage workers (likely immigrants) to
geographies of interest take care of older people
3 Build market map List major players
4 Identify areas of future core business / adjacent markets; regional/global
growth expansion; M&A; human capital; technology; financial
structure; personal networks
5 Assess fit with Fund’s Local geographic leader that would benefit from Fund’s
strategy global reach
© Teten Advisors, LLC 2008. More at Teten.com David Teten, based on public records of major global investors
 Sample Entrepreneur Market Map: Social Networking, mid 2005

Business LinkedIn Xing

Target
Market Social Facebook Orkut
myspace

Dating Match.com Plentyoffish

US Europe LatAm
Geography
© Teten Advisors, LLC 2008. More at Teten.com This chart is purely illustrative and is not intended to be exhaustive.
 Other Sample Market Maps

Customer
Quality
Segment
Distribution Products
Channel

Contextual Info About Each Company to Include

• Management strength
• Product strength
• Client desirability
• Financial returns

© Teten Advisors, LLC 2008. More at Teten.com

 Any questions ?

Slides at www.Teten.com

Free book download

at TheVirtualHandshake.com

© Teten Advisors, LLC 2008. More at Teten.com