There are good days and bad days running a small company, and then there are great days that make it all worth while. I received the following email from a customer today about one of our support guys – this is what we aspire to for every customer!
Hi Penny – I hope you are doing well. I have been a customer of FirstRain, for the past several months. I just wanted to drop a line and let you know what an excellent job your team is doing. In particular, C*** has been extremely helpful in setting me up and working with me on some sophisticated searches. As someone who deals with a multitude of vendors, I am exposed to a wide range of customer service – I must say that C*** is at the top of my list. His is extremely responsive, very professional and, most of all, effective. Thank you again for your help and I look forward to a strong relationship with you and C*** moving forward.
Very best,
T***
My team were prepping me for a talk I am giving at NYSSA next week, and gave me some great statistics on why it is now so important to incorporate the web into your research process. For anyone who needs to get up-to-date, relevant information on business topics, if you don’t have an application to make the web practical you’re missing significant information. In fact, based on our analysis of the web results database we run, 12% of the content is on alternative sources like blogs, trade journals, transcripts etc. but then, when you focus it on business topics and companies, clean it up, de-dupe it, age it (only look at new content) and remove irrelevant documents an astonishing 27% is from alternative sources.
That means if you don’t have an application like FirstRain, you are probably missing more than a quarter of the content that impacts your business. Wow.
12% of total web content is alternative
I sat in on a great panel at the Web 2.0 Summit yesterday. We had executives from the health care, legal and media spaces discussing The Challenges Faced by Traditional Industries Embracing a Web 2.0 World.
I discussed FirstRain’s perspective on what we’ve seen in the financial services world. In this world the challenge in adopting a Web 2.0 platform like ours — which we’re seeing big momentum on — is working past the strong cultural bias toward established, authoritative content providers to consider Web 2.0.
Our clients typically believe that the Wall Street Journal, Financial Times, New York Times and sell-side research will cover the majority of the qualitative information that they need to know every day. Our client is also typically risk averse about their research process. It’s worked for them in many cases for 20+ years and they don’t want to change. So it takes time and effort to get them to open up to the fact that there is relevant, original, useful, and unique alternative research coming out of user-generated sources like blogs.
I also talked about the level of junk on the web and how our system removes it through a series of processes, both human and automated. My fundamental belief is that the buyside demands very high quality and that is a key to our making our customers successful.
As a panel we also talked about what had surprised us selling Web2.0 services to our traditional customers and where we thought the world was going. I discussed both the level of service our customers require, and the coming era of transparency. Both mean that we need to have a very hands on support process for our customers so that their FirstRain usage is configured both to their topic needs, and that they don’t miss anything that impacts their investment strategy.
The other panelists were all interesting, but the one I found most interesting was the GM of a Thomson division called FindLaw.com. This is a service that helps consumers find lawyers, and the most challenging thing Chris Kibarian talked about was getting lawyers to go on line. Lawyers are an inherantly conservative group and often not very tech savvy so he was very amusing describing what they go through to bring up web sites for law firms. The consumer is much more online typically than the lawyer and they’ve been delighted to see the rapid adoption of services like video and social networking within their clients web sites.
All in all – a good experience.
The California team at FirstRain held a pumpkin carving contest again this year – following up from last year’s very successful competition. The challenge was to create a scary pumpkin. We had a bat and a blood sucking loan agent, but the winner was Sarah Palin – the scariest thing the winning team could think of this year (well this is California…).
This years carvers
The winning pumpkin: Sarah Palin
FirstRain announced two great pieces of momentum this morning: CalSTRS has become a client of FirstRain, and we’ve released new capability in our system to support pension governance.
I am proud to have CalSTRS as a client. Their reputation for rigor and integrity is unmatched – and deserved. They and the South Dakota Investment Council are our first two disclosable pension clients, and we’re seeing intense interest from pension funds globally as the pace of regulatory actions and change increases and shareholders sharpen their attention.
Pension governance is a specific set of requirements for pension funds. It involves automated monitoring and analysis of:
- Traditional corporate governance, which includes by-laws changes, anti-takeover provisions, executive compensation,, and board independence
- Rule-making processes at the government, financial exchange and global regulators
- Opinions, actions and statements of peer institutions, activist investors, and other global market participants
- Environmental & Social Responsibility trends, rules, and risk analysis
This is a timely introduction, as investment officers are under significant pressure to reduce governance risk in a systematic and repeatable way. The automated governance analysis process using FirstRain is a step in the right direction.
Today is an important day for FirstRain – we’re announcing a major partnership with FactSet Research Systems. There is a rapidly growing awareness of the importance of the web in financial research and we are thrilled that FactSet has selected FirstRain to be its partner on providing web data into their process. We are proud to work with such a highly-acclaimed market leader.
To put it in today’s context, as the market swings with unprecedented volatility, our customers on the buyside need complete information more than ever and cannot carry the risk of missing critical information about their investments. As Clint Anderson at Meritage Portfolio Management says:
“Prices react rapidly to new marketplace information, so it’s important to have as much of that information as possible. FirstRain consolidates hard-to-find data from the web on our portfolios, sectors, and industries. Integrating FirstRain with the analysis I do in FactSet provides a more complete picture of the market.”
For users who are customers for both Factset and FirstRain this will mean a more seamless research process. The FirstRain platform in now integrated into Marquee allowing a user to move from a Marquee view of a stock straight into a FirstRain view of the stock – and effectively adding the web as a new dataset into the Factset platform.
For FactSet users who are not yet FirstRain clients, we will offer a sample snapshot of company data and the ability to request up to 5 company tearsheets showing the FirstRain web view of the company.
FactSet is the second top tier financial platform to add web research capabilities into its platform, and the second to select FirstRain to do so – Capital IQ was the first.
As I have been talking with our clients these past few weeks, it’s obvious that the shakeout we’re chronicling in our free report: Eye On The Storm is certainly not over, but I’m hearing their confidence that, while this will be an ugly downturn, it is not the end of the world as we know it. And managing money hasn’t fundamentally changed. Investors still need high quality and complete information to make decisions from and both the web and FirstRain are seen more and more necessary components of the research process.
We’re developing an important new capability within FirstRain this month and there are many opinions and ideas knocking around the brainstorming meetings. As you can see here the ideas come in vibrant colors, and one of our lead researchers has come over from Gurgaon for a couple of weeks to play a key role in the design process.
Getting everyone’s ideas on the wall, organizing them into themes, and prioritizing the groups helps us build a richer product implementation. We believe you just get better products if you have a robust brainstorming methodology as a team.
Per Technorati’s State of the Blogosphere Day 1 report – some fascinating statistics on who is blogging. It’s not the teenage unemployed geeks or housewives writing about their kids that the press sometimes imagines. It’s a business relevant, earning group, which is why blogs are rising so rapidly in importance as a source of news and the new wave of publishing – citizen journalism.
Did you know:
There are now a million blog posts a day – This is a huge source set of information
80% of bloggers write about brands and products – This is business relevant information
58% of bloggers are over 35 years old – The writers are mature, not kids
56% employed full time – And they are professional
51% make more than $75K/yr – And they are relatively wealthy!
And this is why the majority of our customers want us to bring blogs to the front of their FirstRain data.
I posted on Greenlight Capital and David Einhorn’s shorting of Lehman months back – David has been shorting Lehman for a long time based on his team’s analysis of the risk underlying Lehman’s business. He did what he thought was right and stuck to his guns despite being attacked by Erin Callan -then CFO of Lehman – and being made a poster child of the short sellers by the New York Times in June of this year.
After writing and researching that post my interest was piqued and so I read David’s book “Fooling Some of the People All of the Time“. It’s a bit wonky but provides a thorough, and thoughtful look into the research that goes behind the great short calls. I’m not talking about rumor driven shorting, I’m talking about months of fundamental research to model out a company’s business and study the discrepancies between what management is saying (and the stock is valuing) vs. what is really happening in the financials and the market of the company.
Given our business is about enabling our users to use the web as a broad, deep research base I love to read about the value of fundamental research to a portfolio manager.
Our users can comment on the web results we send them – marking them relevant or not relevant – and why. Ranjeet ran a word cloud on the feedback we’ve been getting – unedited – and I love the results!
Thanks to wordle.net for the word cloud.
