I thought it would be valuable to describe how I do fast vendor evaluations. Practically every day somebody reaches out over Linkedin to ask my opinion on the prospects of a particular company. Unless I have been briefed by or worked with the vendor recently, I run through this process.
I also do this for every single vendor in the Directory published in Security Yearbook. The current Directory has 2,337 vendors in it. I have a month to review 900 additional vendors my team has identified as potential candidates for inclusion.
I use vendor headcount as the basis for a bottom up analysis of market segments. See the just published Cyber Threat Intelligence Market Research Report 1H 2020.
Here is the checklist:
Step 1. Check the vendor’s Linkedin page.
Linkedin has become one of the most valuable tools for evaluating vendors.
Look for number of total employees. This includes advisors and board members, yet is usually +/- 3-4 of the real number. If there are two employees listed it is probably very early stages or a side gig for the founder. Check the founder’s profile. If they are an industry veteran with successful past exits it may be a vendor worth following.
If there are more than 25 employees Linkedin will provide a timeline of employee numbers going back two years. Click on “Insights” to see that. (You have to be a Pro Linkedin subscriber.) A viable vendor is probably growing at a healthy clip of at least 50% a year unless they are in the thousands of employees. Even then they should show consistent growth over two years. Is engineering employment dropping while sales increasing?
If there are fewer that 25 employees you are blind to recent changes. That’s why IT-Harvest records every company’s total employment every quarter. (Heads up to stock market investors: I have seen a very close correlation between headcount change and reported quarterly revenue.)
Check the HQ address. A vendor’s base of operations tells you a lot. Malta or Iceland? Probably not going global soon. US, UK, Canada, or Israel? Good chance of offering global opportunities.
Check out the founders. Usually, they are the CEO, CTO, or both. Are they experts? Is this their first dance?
Step 2. Check out the website.
Does it have a clear and concise statement of their value proposition? I can tell you right now, nobody is looking for an “AI/ML/Blockchain solution for their most pressing Big Data management problems.”
Step 3. Search Crunchbase.
Look at the total investment and latest round. Did they take in $50 million in 2005 and do a debt offering in 2019? What caused them to languish? Crunchbase also provides a list of recent news events like new partners, big customer wins, or opening offices in new regions.
Step 4. Glassdoor
You have to use judgement with Glassdoor reviews of a company and the CEO rating. I have found that most reviews are either from disgruntled former employees or plants from the vendor marketing or HR teams. That said, you can derive some valuable insights from the story that develops from reading the reviews.
That’s it. I can do this in five minutes for any vendor. At twelve an hour that means I have 75 hours of eye straining work ahead of me to complete the Directory for Security Yearbook 2021.