Technology Blog

Via recruiting expert Shally Stackerl, the pros and cons of sites like LinkedIn, Spoke, and Plaxo .

This post was written by David Teten, source: Pros and cons of online networks

=================================================================================
Seeking ecommerce/consumer technology experts for Chicago Jan. 16th and San Francisco Jan. 17th Hedge Fund Dinners.
=================================================================================

Nitron Advisors, an investment research firm, is hosting two dinners for ecommerce and consumer technology experts to talk with hedge fund investors interested in these sectors. These invitation-only events will be taking place in Chicago – January 16th and in San Francisco– January 17th. You will have a chance to talk informally with some of the major institutional investors in this sector.

We’re looking for senior industry executives and other experts with the following backgrounds:

Consumer technology areas of interest:
+ Personal computers (Dell, HP, Lenovo, Apple, etc.)
+ Flash memory (SanDisk, Kingston, Corsair, etc.)
+ MP3 Players (Apple, Creative, Archos, etc.)
+ GPS Systems (Garmin, TomTom, etc.)
+ Mobile telephones (Nokia, Motorola, Palm, Blackberry, etc.)
+ Distributors (Ingram Micro, Arrow Electronics, Synnex Corp, Tech Data Corporation)

Ecommerce areas of interest:
+ Online specialty retail (eBay, Amazon, Blue Nile, Overstock, Audible)
+ Online auctions (power sellers on eBay, other auction sites)
+ Search engine space (Google, Yahoo, MSN)
+ Consumer generated media/free video hosting services (YouTube, MSN Video, Yahoo Video, Google Video)
+ Online advertising/marketing (ValueClick, 24/7 Real Media, aQuantive)
+ Lead generation players (Autobytel Inc, Move Inc, Bankrate, IAC InterActiveCorp, HouseValues, etc.)
+Online media (PRIMEDIA, New York Times/About.com, etc.)

The final selection of experts to attend is based in part on the interests of specific investment firms who are attending. Attendees receive an honorarium as well as travel expenses and of course dinner covered.

If you are not already a member of our Circle of Experts and would like to attend, apply as an eCommerce specialist at: http://circleofexperts.com/apply-form.html?i=17&rid=0 . Apply as a Consumer Technology specialist at: http://circleofexperts.com/apply-form.html?i=11&rid=0 .

Otherwise, please contact Jesse Mandell, 1-212-682-6455, JMandell@nitronadvisors.com, with your response or further questions. Please note that we must review your bio and talk with you before we can accept you for the dinner.

This post was written by David Teten, source: Seeking ecommerce/consumer technology experts for Chicago 1/16 and San Francisco 1/17 Hedge Fund Dinners

“On the 9th Day of Xmas, Guerrilla Marketing for Job Hunters revealed to me: Nine Tools for Researching Leads.” Whether you are looking for sales or job-hunting purposes, there are a vast number of services you can subscribe to for free that will bring information on worthwhile new companies straight to you. This is a useful list.

This post was written by David Teten, source: Nine Tools for Researching Leads

Congratulations to the team at Accolo, which was just named the #1 fastest growing private company in the San Francisco Bay Area. Accolo is the company that acquired Teten Recruiting. For more on their approach to recruiting, see “Use Online Networks to Find Your Star Employee“.

This post was written by David Teten, source: #1 fastest growing private company in San Francisco Bay Area

From the “brazen careerist”, 10 Job-hunt tactics you might not know:

2. Use proactive recommendations.
Instead of waiting for a hiring manager to ask for references, have your reference call immediately. This works well if you have a heavy-weight reference, like a well-known CEO or someone who knows the hiring manager. But it also works well if you have little professional experience.

more

This post was written by David Teten, source: 10 Job-hunt tactics you might not know

Via Wharton’s newsletter:

It’s always been assumed that when employees leave their companies to join other ones that all their knowledge and experience leave with them. But new research suggests that, at least in the high-tech field, firms can wind up gaining access to the knowledge being generated at their former colleague’s new place. The results of this research are presented in a paper titled, “Learning from Those Who Left: The Reverse Transfer of Knowledge through Mobility Ties,” by Wharton management professor Lori Rosenkopf and Wharton doctoral student Rafael A. Corredoira.

…

“Contrary to the view that companies lose something when a worker leaves, the study found that they stood to gain. Specifically, firms that lost an employee to another firm were 8% more likely to cite that firm than other equivalent firms, Rosenkopf says. The reverse flow of knowledge was particularly pronounced when the employee moved to another region. Then the old firm was 22% more likely to cite the new firm.”

http://knowledge.wharton.upenn.edu/article/1565.cfm

This post was written by David Teten, source: The many benefits of your star employees leaving the firm (?!)

Nitron Advisors’ COO, Scott Lichtman, took detailed notes on last Thursday’s panel on “The State of Independent Research” at the New York Society of Security Analysts. It was a well-attended event that covered questions ranging from how independent research firms are capturing value through new delivery models to the impact of Elliot Spitzer’s global research settlement and prospects for research jobs on the buy-side and sell-side.
NYSSA notes that, ‘These are the opinions of speakers at NYSSA’s Career Chat on Independent Research and do not necessarily reflect the opinions of NYSSA or its members. NYSSA does not endorse or promote any of the opinions or products mentioned.’

SPEAKERS
Eric Alexander, President, Institutional Services, Wall Street Access
Michael W. Mayhew, Founder and CEO, Integrity Research Associates, LLC
Paul Spillane, President and CEO, Soleil Securities Group, Inc.
David Teten, CEO, Nitron Advisors
David Weild IV, President and CEO, The National Research Exchange
CHAIR: Richard G. Lipstein, Boyden Global Executive Search

BIOGRAPHIES

Eric Alexander is president, institutional services, for Wall Street Access, which offers research and execution to hedge funds and money managers. He is responsible for strategic development of the firm’s research offering, including coverage of mergers and acquisitions, energy, healthcare, and special situations. Previously, he served as director of marketing, and was instrumental in forging strategic relationships that helped the firm grow over the next decade. Prior to joining Wall Street Access, Alexander was a vice president with the public relations firm Burson Marsteller, where his clients included AT&T and American Express.

Michael W. Mayhew is founder and CEO of Integrity Research Associates, LLC, a ratings, analysis, and consulting firm for the equity research industry. Prior to founding his firm, he was CEO and president of Garban Information Systems, the financial information division of Garban/United News & Media. Previously, he was director of strategic planning and business development for Standard & Poor’s Financial Information Services Group. Mayhew has been quoted widely by various newswires, newspapers, and industry magazines, including Reuters, Investment Dealers Digest, Institutional Investor Magazine, Bloomberg News, Forbes, The Wall Street Journal, The New York Times, Financial Times, and Business Week. He is a member of the Board of Directors of Investorside, the nonprofit trade organization for the independent research community, and chairs a committee of the board to establish best practices for the research industry.

Paul Spillane, president and CEO of Soleil Securities Group, Inc., has been in the securities industry for over 25 years. He started his career at Goldman Sachs. where he worked in fixed income, foreign exchange, commodities, futures, and options products. He then moved to Deutsche Bank, serving as managing director and head of global market sales for the Americas. Spillane subsequently transferred to global equities as a senior member of the executive team responsible for building the global equities businesses. Most recently, he was responsible for establishing Deutsche Bank’s Global Relationship Management program.

David Teten is CEO of Nitron Advisors, a unique research firm that provides hedge funds, private equity funds, venture capital funds, and law firms with direct access to a global network of carefully selected frontline industry executives, scientists, academics, and consultants. David also is the coauthor of The Virtual Handshake: Opening Doors and Closing Deals Online, the first business book describing how to take full advantage of blogs, social network sites, online networks, and other “social software. ” He runs TheVirtualHandshake.com, a resource site and blog, and co-writes a monthly column for FastCompany.com. Teten was CEO of an executive recruiting firm that he sold to Accolo, and CEO of GoldNames, an investment bank focusing on serving the internet domain name asset class. He has worked with Bear Stearns’ Investment Banking division as a member of their technology/defense mergers and acquisitions team, and was a strategy consultant with Mars & Co.

David Weild IV is president and CEO of The National Research Exchange (The NRE), an innovator in products and services that support capital formation. The NRE provides patent-pending analytics and facilities that enable the systematic evaluation and long-term funding of research and related services. Weild served as vice chairman of The NASDAQ Stock Market and spent fourteen years at Prudential Securities, where he served as president of PrudentialSecurities.com, head of corporate finance, head of technology investment banking, and head of equity capital markets. He also chaired Prudential’s Equity New Issues Commitment Committee.

PROGRAM DESCRIPTION
The entire research industry is undergoing a seismic shift that will produce both winners and losers in the coming years. Some of the more innovative research providers will continue to experience growth, while the total number of independent research firms is to expected to fall almost two-thirds by 2009. The need for good research, however, will never go away. Learn the reasons for the coming shakeout and how you can be among the success stories.

Scott Lichtman’s notes:

Richard Lipstein Question: Please describe your business models for independent research.

David Weild IV: We are a utility for Wall Street to get research paid for explicitly, while achieving coverage and liquidity for smaller public firms. Coverage continues to be shed across the industry. Fewer IPOs are symptomatic of this. There were < 200 IPOS in each of last 3 years. Pre-bubble, there were 460 IPOs/year avg. We have 14 patents.

David Teten: We provide access to frontline industry experts who can provide deep insight into the companies and industries you are analyzing. There is a circle of economic agents around any company – suppliers, customers, regulatory observers– who are in an appropriate position to provide fresh information to investors. We provide access to that circle. This means your analysts are drawing conclusions and making the buy/sell recommendations (not us), while you benefit from ready access to unique sources.

There are three trends that drive the fast growth of our model:
1) The destruction of credibility of sell-side research.
2) Trend towards more people, including senior executives, who are managing their careers individually, without assuming they are wedded long-term to a given firm. These “corporate alumni’ are an exceptional base of knowledge.
3) A trend towards people having a public, articulated virtual identity, through personal web sites, bios and resumes online, social network sites, and software that is aggregating people’s backgrounds into a chronological whole. I discuss these technologies in more depth in The Virtual Handshake: Opening Doors and Closing Deals Online.

We are actively seeking out consulting firms and individuals who would like to consult through our platform.

Paul Spillane, Soleil Securities. Our goal: Premier aggregator and distributor of intellectual content. We are a registered broker dealer. We have a significant distribution platform, analysts all around the country and an agency trading desk in New York. Covering 320 stocks, 32 analysts, 3-5 alternative products. Analysts work when they want, get paid based on deliverables. Incorporating Fixed income, Commodities, Equities, and commentary on data sources. If you can think of a new idea, you can provide content in our model. We are looking for employees, firms to partner with and new sources of content.

Michael Mayhew: Integrity is the leading provider of information assessment and evaluation on the research industry. We publish research on the industry including a blog, web-based tools, due diligence on 436 research firms. Now adding 60 firms in Europe to the database. We help funds find research to add alpha, and mitigate risk in using research. Very little due diligence is typically done on hiring a research firm, especially compared to investing in a fund or fund-of-funds. We help funds reduce their risk in hiring a research firm.

Eric Alexander: We offer clients an integrated service, including access to a team of leading analysts in M&A, special situations, oil and gas, utilities and agribusiness. We also offer clients access to a proprietary network of healthcare experts. Also have a trading desk – important for clients to gain a full range of service and for us to get paid appropriately. We customize offerings for each client.

Richard Lipstein Question: What are challenges facing independent research firms.

David Teten: Research has a very unusual economic model: You usually get paid well after the service is delivered, you usually don’t know how much you’ll get paid, and neither seller nor the purchaser knows the exact value of the service. The value of research varies enormously from highly negative to many millions of dollars, yet it’s not common to define, let alone track, the metrics to place a value/price on it. Also, declining commissions on a per trade basis are putting pressure on the economic equation.

Michael Mayhew: 2 major trends.
1) Biggest challenge is proving value, day in and day out. The kind of research that could be sold 20 yrs ago has changed. Today folks want trading ideas and proprietary data points. Very large % of research firms have a tough time proving value, and probably shouldn’t be in business.
2) Getting paid is hard, even if you prove value.

David Weild IV: A rough statistic: He took all research analysts, divided by (monthly) trading volume, and got 20,000 shares/analyst. If 50% is program-based, 50% of what’s left is algorithm based, and therefore there’s only 5,000 shares traded to pay each analyst. That’s roughly 250 shares/day. At 5c/share that is not a lot of money to spread around, and 5c is a high figure by current trading standards. The business is fundamentally bankrupt at some level.
Clients want 3 things – 1) access to management, (2) experts, (3) traditional research. People want things that no one else has.

Eric Alexander: A lot of what the industry does is a commodity. Some of the forms of compensation are a thing of the past. It’s much more entrepreneurial now.

Richard Lipstein Question: Buyside firms are decrying the lack of research but cutting back on # of research suppliers. How did we get in this contradictory situation?

David Teten: The buyside is not seeing enough compelling research from the sell-side. However, the number of buyside analysts is way up, which shows a commitment to proprietary sources.

Michael Mayhew: Other trends are happening too. There will be a significant reduction in # of firms getting paid. Firms will separate research fees and execution fees. You may only have 20 firms getting commissions, but hundreds getting research checks.

Richard Lipstein Question: Paul, how does one manage a virtual corporation?

Paul Spillane: Everything about the decline in research firms/getting paid is music to our ears. This is the only industry I’ve seen that has no idea of COGS (cost of goods sold). We love a value-driven model. If you can add value, clients will pay you unlimited amounts. So good analysts in their virtual workspace are making 2-3x what they did in a bulge-bracket environment. “We manage by compensation.”

The industry needs to get away from the lack of connection between quality and reward – casual votes on who should get what. We have the same regulatory framework that any registered broker-dealer has, with the analysts being registered 86s or 87s. Our good analysts work “24×7″ at times because they love the work and get paid well, and other times take a break.

“It’s an absolutely fantastic time to be an analyst. The bottom is here.” The # of stocks covered by bulge-bracket firms is going lower and lower. The bottom line is here, there will be less people around, but those who are good will be making money. Like Nitron, we only pay an expert when they get a phone call.

Eric Alexander: Research revenues might go from $3.9bn to $3.6bn, but it’s still a big opportunity.

David Weild IV: Wall St research firms are getting smart that they do get paid. Roughly 50-70% of bulge bracket revenues for an offering are for the deal, and 30% is to provide coverage, but the funds aren’t always allocated to that purpose. It seems like Reuters and Thompson want to know who is consuming their research and cut out people who are drinking for free. The tide is turning on getting paid.

Eric Alexander: We are still committed to trading desk model. It’s hard without a desk; it’s integral. The buyside sees their traders as integral to their team and so do we.

AUDIENCE QUESTIONS

Q to Soleil: What does it mean for an analyst to “deliver” value and get paid commensurately?

Paul Spillane: There are many ways to signal how to pay: a voting mechanism, # of visits set up, commissions paid. Clients now are responsible, e.g. Via the UK’s regulations, to say how research is allocated. More hedge funds have a formal voting mechanism due to regulatory requirements. Checks come in with specific analyst names on them to us.

Michael Mayhew: All about producing good research. To one client that’s management access, to another it’s industry expertise, and to another it’s performance recommendations. Issue is that if you produce me-too maintenance research, models that don’t outperform, you have to worry.

Question: What about outsourcing research to India and other places.
Eric Alexander: This question is symptomatic of how much has become commoditized. Reg FD has commoditized information.

Michael Mayhew: Couple years ago, the avg cost of wall st to cover a company was $192K – per company. There was an absolute need to lower that cost, so moving some research oversees made a lot of sense. But value-add of a research firm can’t be outsourced.

David Weild IV: But you can create new value by leveraging offshore resource. It may become a necessity to have competency in offshore inputs.

Paul Spillane: The last mile is where the value is. We get 7 calls/month from Indian firms to provide us with outsourcing. Most of those analysts don’t have 86s/87s and don’t talk to management. Offshores won’t complete with mainline analysts, they will focus on filtering through existing data in more conventional ways, at least for now.
Offshore won’t be a huge threat. We think $8bn will be paid out, over time, in hard research. If you look at outsourcing initiatives in the technology world, JPM outsourced their platform to IBM in a multi-billion deal, but brought it back in-house when the deal expired. We’ll all experiment with it, but when cost goes up for offshore it will lose competitiveness. We used to pay $25K for an associate abroad, now its $50K.

Richard Lipstein: One bulge analyst I know is having increasing quality issues, exacerbated by language barriers, time differences. They didn’t see benefit anymore.

Michael Mayhew: I’m concerned about long term risk. If we outsource associates, when do future senior analysts come from? Are we going to hire the offshore people and bring them here?

David Teten: All of this gloom & doom is great news for Nitron. Offshore people working off same public data further commoditizes publicly available analytics. Basic Yahoo! finance data is free. There are so many hedge funds out there, and they’re all obsessed with chasing alpha, which they can’t do with the same tools as everyone else. (The hedge fund incubators, incidentally, remind me of the dot-com incubators we used to see, which is a sign that there is a surplus of hedge funds. 2006 is the first year when we’re on track to see more hedge funds shut down than open up.)

Audience Question/Observation: In the last few years, lot of great info free on internet has become available in forms of blogs. Incredible corporate-experience types, speaking their minds and providing insights while going after eyeballs. They are getting paid $550K/year monetizing eyeballs (Editor’s note: I know extremely few bloggers earning that type of money!).

Paul Spillane: This industry has to recognize that as a threat. The audience member asking the question has worked in tech – so she’s better able to know where to find quality information. The insights aren’t there for (isolated) associates to make money.

Michael Mayhew: There is a model that’s been developed over a few years, for readily available info: Research that is restricted to small # of clients (and which delivers alpha). Hedge funds will pay lots and lots of money for restricted access, which means 30,40, or 60 clients. Hedges won’t trade off blog content because it’s available to thousands/millions of people. Also, most hedge funds don’t want to say: “if this deal blows up, I’ll tell my manager I got the info free off the internet. ” Give me a break!

David Teten: If I have really good info, am I giving it for free on a blog? Publicly-available information (on a blog, New York Times, etc.) is designed to be relevant to the average person. If you want customized analysis for your portfolio/your situation, then you typically pay the person who produced the analysis that’s broadly relevant. He proves his credibility with his general analysis.

Eric Alexander: Blogs are a threat. Collaborative relationships deliver distinct ideas. You need a talented, experienced analyst with an expert network to find the alpha idea. Blogs don’t work standalone but they are a valuable contribution.

Paul Spillane: Most investors have an overload of info. We have a product to grade blog: Collective Intellect. Using AI to sort through hundreds of millions of blogs a day to rate for accuracy. This product is on desks of some of the largest prop trading desks in the world. It can be a CYA, but you can’t sort through all the available info and it becomes more productive.

Audience observation: Great bloggers are identified and filtered by word of mouth. Experienced people don’t read every single blog.

Paul Spillane: But imagine if you can also grade them all. We’re excited about the prospects.

David Weild IV: In my west coast conversations, a lot of funds are using expert networks. One guy I spoke with was a well respected 1990s internet analyst. Widely followed. He said that one key problem with Wall St research is deteriorated quality. Because of Reg FD, executives are uncomfortable with sharing corporate info. Sourcing of independent experts has become very important. One guy is using expert networks to do due diligence on potential portfolio co’s. Won’t replace need for direct access.

Audience Question: What’s the career opportunity and income oppty for sell-side analysts. Do you see migration to buyside? What about buy/sellside relative compensation?

Eric Alexander: It’s important to be part of an organization with a regulatory structure, so the analyst can focus on the work. There’s an opportunity to be more entrepreneurial these days. Locked in salaries and guarantees are much less available.

Richard Lipstein: The top of the Internet bubble skewed compensation and demand for analysts. Comp for internet analysts gone down significantly. They used to be able to make 7-8 figures. Compensation has bottomed out because of disappearance of guarantees and extreme salaries. Not easy for sell-side analyst to move to the buyside because they’re viewed as a salesperson. However, hedge funds hire more sellsiders, young ones, than mutual funds.

It’s worth noting that a typical analyst will make more than 98% of the US population rather than 99.9% in the past.

Paul Spillane: You summed it up perfectly. It’s not easy to move to the buyside. But everyone is still paying people 6-7 figures. A lot of doctors, lawyers, fireman who don’t get paid that – who arguably provide critical value to society.

David Teten: I saw a talk by a prominent person in the research industry, who said, “If you meet an analyst that’s been on sellside for more than 5 yrs, they’re not good at picking stocks, because if they were, they’d get a job on the buy-side.”

There is increasingly a disaggregation of analyst’s responsibilities. Management access is highly valued by the buy-side–but that’s a concierge service firms like ours (Nitron) do more effectively than generalist research firms.

Richard Lipstein Question: The typical independent research firm is much smaller than bulge bracket dept. There have been problems, eg Overstock.com took a research firm to court for allegedly being part of a plan to devalue and short sell the stock. How can small firm deal with intimidation of big corporation, particularly when issuing negative research?

Paul Spillane: Associate yourselves with a firm with strong compliance. Reputation of your employer is important to focus on when you are an analyst. Unless you commit fraud, you are in a good position to make clear statements - your opinion is your opinion. One analyst whose opinion dropped a stock 50% (is rumored to have) received death threats – from a retail firm!

Richard Lipstein: I think it’s more an issue of small research firms can’t cover legal costs to defend themselves.

Paul Spillane: Agencies like SEC, NASDAQ won’t allow that intimidation…and the First Amendment.

Eric Alexander: Be clear who the customer is. It’s not the company covered, it’s the investor.

Paul Spillane: WSJ or NYT would love to ‘defend’ the small guy with strong opinion. The court of public opinion doesn’t cost much. And it’s great PR.

David Teten: Most of time, the analyst is doing right thing. Owen Lamont research showed that, the more a corporation fights a critical analyst, the more likely it is later on that the analyst is correct. Jeff Skilling said “They’re on to us,” in response to a certain piece of independent research. That’s a great ad for independent research! (As Jim Chanos pointed out in a recent talk).

Audience Question: Given internet bubble, do you see another shakeout?

David Weild IV: There’s a rationalization, but other models are flourishing. The big shoe that dropped wasn’t the bubble, it was decimalization in 2001. That cuts 95% of the commission flow. The internet brought direct transaction models and commission compression – commission went from $350 avg to 5 bucks.

David Teten: Creative destruction is a benefit, not a bug, of capitalism. Net net, people are making a lot of money in finance. The industry is always evolving, companies change, people move around, but the quality people do just fine.

Michael Mayhew: For sell side research, unbundling will have a big impact. When asst mgr has ability to select research and broker independently, that will really impact someone like Goldman Sachs. If they charge 4c/sh, how much is for research and how much will get they for this

Question: What’s the track record of Spitzer agreement to channel $s to indie firms?

Eric Alexander: Some large firms got huge funds channeled to them. We’re not in that space at all. I’m hopeful this is over soon, it hasn’t been effective at all.

David Teten: Spitzer uses lawsuits effectively for gubernatorial campaigns, but not necessarily in the pursuit of justice.

Someone asked a panel I participated on earlier this year “where should I invest, as a retail investor?” Look, you as a retail investor have the worst information and the worst prices. You’re much better off hiring a professional, by putting your money in a mutual fund, hedge fund, or hiring a Financial Advisor.

Spitzer agreement was a solution in search of a problem. The retail investor will almost inevitably have inferior returns to the professional, because of the nature of the industry.

Richard Lipstein: The Wall St. Journal said ‘you can’t legislate against greed’.

David Weild IV: I’ve talked to many of the NASD regulators. All agreed that the Spitzer agreement has been an “absolute disaster”. Jack Coffee, of Columbia, on their board, calls it a new form of government. It has created a level of paralysis – 3 years left, and firms are afraid to innovate. Every bulge bracket says behind close doors won’t pony up again. It hasn’t expanded coverage to new names. It was a grand experiment that failed. “This is a drug.” Has failed to expand coverae.

The audience member asked what are usage statistics for the independent research that had to be posted. 5% of retail hits are on the indie research, the rest is from the main provider. The only success from the agreement is focusing people on the problem – Wall St research has greater integrity today.

Teten: There is one pressing, highly important public policy goal that the Spitzer settlement achieved: Spitzer won the primary.

Question: Comment on future consolidation in independent research firms. Is pace likely to quicken? A panelist said there are over 400 firms today.

Michael Mayhew: 450 firms in N. America. We certainly believe in consolidation but not across the board. Restricted providers will do quite well. Fundamental data-based research will consolidate. My partner has argued that research is frankly a lifestyle business for many. If you have a dozen clients paying $100K each, you can have a nice business for a few analysts. I suspect the number therefore will be unusually high, but fundamental traditional research will find it increasingly difficult to get paid.

David Teten: Consolidation per se doesn’t concern us. I would be worried if the overall pie shrinking dramatically. But to my knowledge, expert networks are the fastest growing sector in the research business. Consolidation means we buy or get bought, and there are worse things that can happen.

Eric Alexander: For full disclosure, my business partner in the audience asked the consolidation question. The alternative to a lifestyle approach to making some money in research is being part of collaborative effort. When someone like Monsanto wants to do a deal, they can turn to one of our deal specialists.

Richard Lipstein Question: What about the idea of a corporate rollup, e.g. how Eric Alexander got Foresight.

Eric Alexander: That wasn’t an acquisition but a subset of analysts were attracted to our platform.

David Weild IV: Question for Michael–What # of firms have > 5m revenues?

Michael Mayhew: Quite small, < 10% of 450. Lot of folks with $1m revenue. Some consolidation when firms go out of business, other when firms get bought.

Question: Going back to the value of research, how is the way investment firms are compensated linked to value? In an unbundled world, mutual funds are asset-based profit-makers, not performance based, so they should worry less about costs. Hedge funds are compensated by assets and performance, so they are looking for research value. Would mutuals prefer bundled research?

Michael Mayhew: The audience member asks analysts how they judge good research. They say, “I’ll know it when I see it.” This means, many buy-side people don’t know what makes good research to them. That only has a chance of working if they get research for free, use it, then decide later on if they liked it, but its still subjective.

David Teten: There are 3 reasons why hedge funds are desirable clients. They have a lot of money compared to cash/overhead requirements, they don’t usually have an easy way to measure the value of your unique product (compared with tools available to measure ROI if you are selling, e.g., bottled water to them), and they are paying with soft dollars, i.e., other peoples’ money. I have problems with how soft dollars are used when applied too broadly, but the system works to the benefit of research firms.

Eric Alexander: It’s a lot harder for a research firm to penetrate/develop business with large mutual fund. “I’m sitting with a fire hose of info” says one large-fund portfolio manager. They need barriers to access, not more info.

Question: What are new models on how to pay for research: Is it arbitrary or still predominantly through trades?

Paul Spillane: 85-90% is still via soft dollar. It will take a lot longer to wean off than anyone thinks. If a large mutual fund company wanted to separate costs, it could be 3% of their management fee. For a smaller firm, its entire management fee could be allocated to research cost.

Richard Lipstein Question: Last question. For someone looking to get in the research business, what does this business mean for the up-and-coming professional?

Eric Alexander: Paul Spillane and I say same thing. Be good, and be entrepreneurial. If you have been a salesperson, bone up on analytics. If you are an analyst, participate in selling.

Michael Mayhew: Ample opportunities for good and great analysts. A lot of analysts have spun off with high expectations.

Paul Spillane: If you love it and are passionate about it, there’s never been a better time. If you don’t love it, join a bulge bracket firm. You get real motivated when you wake up thinking “how am I going to make money for my family?”

David Teten: Be focused to add value. There is a story, true I believe, of one analyst making over 2 million covering one stock (McDonald’s). Pick a domain you can own, then become the recognized expert in that domain.

David Weild IV: 1) Being a research analyst is a wonderful thing, whether starting independent and or bulge bracket. You learn a real discipline in a dynamic market (securities). You can switch to private equity or corporate side. It’s a great training ground. I’d like my kid to do this.

2) Just to mention separately, this is anniversary of 9/11. There is a wonderful organization on that was on 60 Minutes called Tuesday’s Children, which provides services to kids who lost parents. Helps them get through college. Annual event at Cipriani’s 9/27. They placed kids on take-your-child-to-work day. I’m on the board of directors. Please consider supporting them.

This post was written by David Teten, source: The State of Independent Research, at NY Society of Security Analysts

Via Barbara Safani, a no-cost job search ebook from Career Hub:

I’m excited to announce our very first eBook! The book, which features in-depth job search advice from 17 career marketing experts is available for download now.

We put this book together because we know that so many job seekers feel lost when they start out on their search. Having put all their time and energy into making their employers successful, they’ve had neither the time nor the need to keep up with the latest in job search strategies.

The Career Hub contributors are career coaches, recruiters, consultants, business executives and resume writers and all have valuable knowledge to share. So I asked each of them to contribute to this free eBook in order to share what they know with those of you who are working your way through the job search process now (or plan to do so in the future).

Please feel free to share the book. And tell us what you think, either by email or in the comments. We plan to issue more free eBooks and your feedback will help us make them as useful as possible.

Download here.

This post was written by David Teten, source:

The event below is targeted at CFOs of mid-size and larger companies (over $50M in revenues). I hope that you can join us.

CFO Leadership Team
First Alumni Gathering
September 21, Stamford, CT

The Virtual Handshake:
Opening Doors and Closing Deals Online

Join fellow CFOs of mid-size and larger companies, and learn how to accelerate your sales, recruit star employees, enhance your marketing, or just find your next job by using online networks. David Teten will discuss blogs, social network sites, virtual communities, relationship capital management software, biography analysis software, and other new tools.

When: September 21, 6:30 to 8:30 PM
Cost: $30 including hors’deurves, cash bar
Where: Stamford, CT (location disclosed to confirmed attendees)
RSVP: by September 14 to Kevin McEnery, KJMcEnery(at)aol.com, 1-203-348-4435

Who: This event is open only to members of the CFO Leadership Group. Members must have experience as CFO or Divisional CFO in an organization with at least $50M in revenues. A few select recruiters specializing in CFO searches will also attend. Our members have experience with companies that include Acclaim Entertainment, Altria, Arc, Associated Press, Atari, Barnes & Noble, Calvin Klein, Dover, Gartner, Georgia Pacific, Gerber Scientific, Groupe Danone, Kodak, Labatt, McCann Relationship Marketing, Nestle, Newsweek, Pepsi, Revlon, Rogers, Scholastic, Sesame Workshop, The Reader’s Digest Association, Time Warner Cable, and World Wrestling Entertainment. Nominations welcome for members.
Why: To see old and new friends

MORE ON OUR SPEAKER

When you finish David Teten’s program, you’ll know how to:
* create a powerful professional presence online
* attract business in online networks
* meet more relevant clients and potential clients
* start and promote your own blog
* master the email deluge
* analyze and value your community of business partners
* manage your contact database
* ensure privacy and safety online

“We hosted one of David Teten’s presentations at the Euromoney 2004 Annual Hedge Fund Start-Up & Business Development Forum. Out of 40 speakers, David tied for first place for the highest speaker rating.”
- Diane Higgins, Financial Markets, EuroMoney PLC

BIOGRAPHY

David Teten is CEO of Nitron Advisors ( www.NitronAdvisors.com), which provides independent industry experts with consulting opportunities to hedge funds and other institutional investors. To participate in paid interviews with Nitron Advisors’ institutional investor clients, at no cost to you, join the Nitron Advisors Circle of Experts ( www.CircleofExperts.com ). David is the co-author of The Virtual Handshake: Opening Doors and Closing Deals Online ( www.TheVirtualHandshake.com ). David was formerly CEO of an investment bank specializing in Internet domain names. He has worked with the Bear Stearns Technology investment banking group and Mars & Co strategy consulting.

This post was written by David Teten, source: Sep. 21, Stamford, CT: for CFOs of mid-size/larger companies

From Harvard Business School Working Knowledge:

The researchers identified four successful tactics for obtaining stretchwork that were common to both groups:

* Differentiate competence. Anyone hoping to advance must distinguish his or her performance on the job. This is particularly true, however, for contract workers—because they are paid for each short-term job, their employers are likely to subject their work to close, frequent evaluation.
* Acquire referrals. Because high-tech contractors tend to work with a number of clients, brokers, and fellow contractors, they enjoy a broader social network from which to draw referrals than most permanent employees. In the film industry—where most hiring is done based on a production manager’s previous experience with an individual—referrals are a vital aspect of getting any job, particularly if it stretches a worker in a new direction.
* Framing and bluffing. “This is one of the most creative attributes for obtaining stretchwork,” O’Mahony notes. “People who are good at presenting their prior experience in a way that allows for an easy translation to the desired job can narrow the gap between their past experience and future capabilities.” Adopting a hybrid job title to identify oneself—”director-screenwriter,” for example—can also help establish authority in more than one area.
* Discounting. Accepting pay below the market rate is a temporary disadvantage some contract workers are willing to accept, if it means gaining the experience and exposure that will lead to a new position. One technical writer put it this way: “I turned down solid offers from three companies, all paying over $100K a year…I would take a job at $55K if they’re using a totally new technology so I learn something…It’s like playing pool…You hit the green ball with the white ball, and the point is to place the white ball to get the next shot. So I take that job in order to learn skills for my next project.”

More…

This post was written by David Teten, source: Advancing in your career without experience

I was just invited to be on the panel for a webcast tomorrow (Wednesday) at Human Capital Institute entitled Leveraging Corporate Alumni, which will look at how organizations can benefit from managing relationships with former employees.

I’ll be talking in particular about how both official and unofficial alumni groups are using social software, and how recruiters can leverage them in an ethical and effective manner.

The event is free, but you do have to register in advance to attend.

This post was written by Scott Allen, source: Free Webcast Wednesday 8/2: Leveraging Corporate Alumni

Anjali Athavaley of The Wall Street Journal writes on Getting the Scoop on a Future Boss:

There are now more ways to get the inside scoop about an employer — before you are hired.

In the latest expansion of the Web phenomenon of social networking, more sites are launching features that make it easier for job seekers to connect with the employees of prospective hirers. Still, before you gather around the virtual water cooler, keep in mind that on many sites, what you post can be viewed by anybody — including your current or future boss.

Whether you’re approaching a company about a job or to sell to them, I definitely strongly recommend that you look for insiders who can give you the scoop about the company. One tactic Anjali doesn’t discuss is: look in resume database (like Monster) for people with a background similar to yours, and approach them for advice.

This post was written by David Teten, source: Getting the Scoop on a Future Boss

Via Marc, I was led to a blog post by David Manaster on recruiter efficiency. He reports that “It would seem that (on average) the optimal workload for a recruiter is between 11 and 20 open positions. ”

I’d argue that the main reason for this phenomenon is that most recruiters are using only the traditional toolkit: Excel, Word, email, phone, to keep track of their applicants. Nitron couldn’t function effectively if we were this inefficient. John Younger, CEO of recruiting process outsourcer Accolo, observed:

I actually find this research to be right in line with our surveys for the typical recruiter today. We have found the optimal workload to be between 4 and 18 unique full-time jobs simultaneously. At 18 or more, the applicant screening, follow-up and tracking take a severe dive. The astounding part is that this is the same recruiter workload of 1963! Think about it. What else in our lives has not budged a bit in productivity in over 40 years! This is the time before e-mail, job boards, the internet and Starbucks. The core reason is that the recruiter today operates in exactly the same model as the early 1960’s. All we have done is pave the cowpath. It gets worse… the hiring manager service and applicant experience have actually diminished with all the technology noise in the middle. There are new models emerging, but there is an army of people invested in keeping things the same.

According to a staffing.org survey of 2,294 companies, during 2005, the national average Recruiting Efficiency Index was 12.3%. REI is calculated by dividing total recruiting costs, including recruiter salaries & overhead, applicant tracking, advertising fees, etc. and dividing it by total compensation recruited. Accolo reports an REI of under 7% for clients using Accolo’s system. Among the drivers for that efficiency:
- much higher per-recruiter workload
- use of online networks for recruiting (more on that topic)

This post was written by David Teten, source: Executive Recruiter Efficiency

From our latest FastCompany column:

Your dream employee is lurking out there. How do you find him or her? To track down those stars, recruiters are aggressively using online tools such as blogs, virtual communities, social-networking sites, and biography-analysis software. Here are some best practices in those areas, drawn from Accolo, Nitron Advisors (my firm), and Microsoft.

(Disclosure: I’m on Accolo’s Advisory Board).

full column

This post was written by David Teten, source: Use Online Networks to Find Your Star Employee

For Job-Hunters (and Salespeople): How to Find a Contact Name Inside a Target Company

Job-hunters have a number of hurdles to surmount, but one of the greatest is this: how do you get a name inside a target company? When you want to send a letter of inquiry to a company (about a job), you really want to find the right person’s name, in order to contact him or her. If you can’t find the right person, you want to find someone who can put you in touch with the person you seek. Here are ten ways to find a name inside a company you are targeting.

More…

This post was written by David Teten (admin), source: For Job-Hunters: How to Find a Contact Name Inside a Target Company

Maureen Crawford Hentz writes on Phone Interview Etiquette Can Propel You to the Next Step in the Hiring Process.

This post was written by David Teten, source: Phone Interview Etiquette Can Propel You to the Next Step in the Hiring Process

I was discussing Phil Wolff’s comments on
social software in recruiting with John Younger, CEO of Accolo. He wrote:

What I find interesting in the intersection of social networks and jobs is that there is a third party that seems to be completely missed. Specifically, the party that pays the bills – the companies.

At the job level the equation gets easier. Use the network for find the right person for the job. Unfortunately, these networks keep on rolling even after the job is filled, and the hired candidate keeps on networking by definition. Two gaping holes:
+ Free-form networking (liked LinkedIn) actually encourages working around the company approved process, and
+ employees could be “networked” out of their new job in a relatively short period.

The solutions that “giveth and taketh away” will be fired in short order once the companies figure it out, which is a material obstacle to the theories of social networking and recruiting.

Responding to John’s point: I’ve heard through the grapevine that both Linkedin and OpenBC have been blocked at certain companies, for the same reason that many companies won’t let their employees surf Monster/HotJobs/Careerbuilder on company time.

Of course, the power of LinkedIn, OpenBC, and like companies is that they provide a motivation for people to maintain their public professional profile on an ongoing basis. By contrast, Monster/HotJobs/Careerbuilder have a relationship of “punctuated equilibrium”: a job-seeker uses them heavily for 2 months, and then doesn’t visit the site for 4 years until they start looking for a new job again.

The average American has been employed at his/her job for only 4.0 years. You cannot rely on your employer’s network or your father’s network; you have to build your own flexible, lifetime community to land your next job. When you’re currently employed, you’re only between job searches.

This post was written by David Teten, source: Social Software and Executive Recruiting

Katharine Hansen discusses how to maximize your internet job search: http://www.quintcareers.com/maximizing_net_job_search.html

This post was written by David Teten, source: How to optimize your Internet job search

Courtesy of Mike Lorelli, President and CEO of Latex Foam International, the only U.S.-based Talalay latex foam producer, and largest supplier of latex mattress components and pillows in North America. (Full disclosure: I edited the first two bullets.)

13 Little Things About Resumes and Emails

1. Cover Letter File Names: recruiters prefer: Lastname-Firstname-2006-cover-letter.doc

2. Your resume file name: recruiters prefer: Lastname-Firstname-2006-resume.doc
   

3. NEVER send your resume as ‘resume.doc’ If a recruiter downloads ten emails, and half the people use ‘Resume.doc’. . . you’re dead (and should be!)

4. Your ‘Subject Line’ must signal that this is not a spam message.

Use ‘CEO-NJ Fragrance Co- Mike Lorelli’ to concisely signal your purpose.

5. Don’t put a fax # on your resume. Fax is rarely used, and makes you look like a ‘trailing-edge’ person.

6. Don’t use “PROFESSIONAL EXPERIENCE,” unless you plan to list prostitution or other “NON-PROFESSIONAL EXPERIENCE.”
   
   
7. Don’t complicate things with the name of the parent corporation, or division name, or whether or not the firm is incorporated. List the parent only if it’s a recognized Fortune company and thereby enhances the Division name.

8. Don’t waste space explaining that PepsiCo is “A leading food and beverage conglomerate with operations in 97 countries.” If the company is recognized, save the space.

9. Omit the STATE, if 99% of the readers will know in what state cities like Boston or Atlanta, Indianapolis, Chicago, etc. are. Ditto for Foreign Cities. Paris, Buenos Aires, Mexico City, Montreal.
   
   
10. Avoid grid- type fill-in-the-box styles. When viewed electronically, you look like a college senior.

11. Resumes are two pages in length. Anything longer signals that you have poor summarization skills. Alexander Haig’s resume is one page, and he accomplished more than I have.

12. Over 50? Don’t make the mistake of leaving off your year of college graduation. You look pretty silly when (100%) of the people figure it out. In fact, do the opposite! On my cover letters I add a ps that says:

ps: I am 52, have an MBA from NYU, 1973, and am an active outside director and trustee

It’s my way of signaling “52 and proud of it!”

13. Have a ‘PERSONAL’ section at the end of your resume. Show some personality and some color. People prefer to work with humans, not machines. Below is my section.

PERSONAL

Married. Two precious daughters. Author of childrens’ best-seller, “Traveling Again, Dad“ with profits donated to childrens’ charities. Have traveled to 44 countries. Avid runner. Active private pilot. Excel at no sport. Member Business Executives for National Security. WPO.

I get a lot of comments on the “Two precious daughters” and “Excel at no sport” lines.

This post was written by David Teten, source: On writing and sending resumes via email

Are you being pushy if you contact an employer after submitting a resume? The opposite may be true, suggests a new survey from Robert Half International.

Eighty-two percent of executives polled said job seekers should contact hiring managers within two weeks of submitting application materials. Only five percent said professionals should refrain from communicating once a resume has been sent.

More

This post was written by David Teten, source: When to Follow Up on a Job Application