Episode  126 – Syndicated Research: A Unique Way to Productize a Service and Generate Recurring Revenue – Member Case by Michael Ellison

Selling and delivering insight is at the heart of what professional service firms do. Some pro serv firms have packaged their expertise into research and sell it as a “product” via subscription. Attend this session and hear how member Mike Ellison has done this and built a 95-person firm in the process.


Greg Alexander [00:00:10] Welcome to the ProServe podcast, a podcast for leaders of thriving boutique professional services firms. For those that are not familiar with us, Collective 54 is the first mastermind community focused entirely on the unique needs of the boutique proserv firm. My name is Greg Alexander, I’m the Founder, and I will be your host today. On this episode, we’re going to discuss syndicated research and why I believe it’s an effective way to package expertise and thus scale a professional services firm. And we’ve got a great role model with us today. We have a member by the name of Michael Ellison, and he’s in the syndicated research business, and he’s going to share his journey with us. So, Michael, we appreciate you being here today. Would you please introduce yourself and your firm to the audience?

Michael Ellison [00:01:06] Sure. Greg, thanks. Happy to be here. Thanks for having me. My name is Mike Ellison. I am the President and CEO of Corporate Insight. We do competitive analysis research on the digital customer experience for financial services and health care industry. So we help our clients who are large banks and insurers to understand how their websites, their mobile platforms and the whole customer journey online compares to the competition, what they need to do to improve.

Greg Alexander [00:01:32] Okay, very good. So let’s start with the very basics, the term syndicated research. Please define that for us.

Michael Ellison [00:01:40] Sure. So I think in prior purest form syndicated research, it comes out, I think really the marketing profession and it’s it differs from customer research in that it’s often put together by not just one client, but perhaps multiple clients. So you might have a study that gets done and rather than say, you know, just Company A being the sole sponsor of the of the research and thus own all the data, a research company might form a syndicate, so it might be half a dozen or so companies that get together have similar objectives that they want to get out of it. And then collectively, they own all of the data and the findings.

Greg Alexander [00:02:23] Okay, very good. There are some very large firms that have that business model at their core. The one that obviously comes to mind is Gartner Group, just because they’re large and public. Why do you believe that putting a syndicate together as an approach to generating research is such a scalable activity?

Michael Ellison [00:02:47] Well, I think the economics are just such that, you know, you kind of do the work once and you sell it multiple times. You know, I know with us, we we probably are, it’s more productized, too. So, you know, we well you can we call our research syndicated, really what we have as a product. So we don’t necessarily put the work together. And Gartner’s the same force has got a similar model. You know, it’s not we don’t have a bunch of companies that come to us as they do the study. We actually do the research. It’s a subscription-based, it’s annual-based research, and then we sell it to multiple people in multiple firms. So it’s it’s a lot more scalable, obviously, than just having one company come and do the study and then they own the data. You know, we own the data. We can do a lot with it. And and the our clients don’t subscribe to it and they get access to it.

Greg Alexander [00:03:37] Yeah. So I was so excited to have you on the call today because your starting point was scale was built right into it per the description you just gave us. Many of our members are the opposite. They’re starting off as, let’s say, consulting companies and they have, you know, they get hired to do a project for a client. Many times it’s a custom project. And then the way they scale their firms is they just try to do multiple custom projects over time and eventually that hits a ceiling, right? If everything’s a snowflake, it’s kind of tough to really scale that you’re going the other way. You know, you started with this syndicated research concept, and in a moment, we’re going to talk about how you’re also doing consulting and the pros and cons of that. But for somebody who started, let’s say, as a consulting company and wants to, quote unquote productize to use your term, that’s the buzzword these days, what advice would you give them as to moving from point A to point B?

Michael Ellison [00:04:29] Yeah, I think it is hard to say because we to your point, we kind of started at point B. Yeah. But I’d say find the common ground, you know, what are you solving that’s common to the industry? What are the problems that are common amongst all the players in the industry and how can you take that problem, that solution, and and just make it applicable to everybody? You know, what can you do that enables you to do the work once and then sell it multiple times? You know, it’s it’s it’s I think that’s kind of the key to it.

Greg Alexander [00:05:05] Yeah. So the way it works for you, let’s say there’s a new research report you guys want to produce. Do you go and get multiple sponsors for it, then go do the research and then sell it to the broader public? Or do you make the investment, do the research yourself with no sponsors and then sell it as a subscription, so to speak?

Michael Ellison [00:05:24] Yeah, it’s a great question. And when we were smaller, just for context, we have about 95 employees now and when we were smaller and had less bandwidth I guess we would try to pre-sell it. We had the idea. Or usually what happened. A client would come to us and say, Here’s here’s what I need. And we say, Actually, that’s a really interesting idea. We’ve had a couple other clients, you know, let’s take this on and let’s, you know, let’s see if we can build a product. And so we’d say we’d want to sell it to maybe three or four other clients before we actually agree to do the work. And that obviously, you know, it’s made all the costs paid for it kind of the you know, the initial group would sponsor it. Often we would have a charter membership or a charter subscription rate for that, and then you would get those for kind of backed it. We do it and then we’d launch to regular people might add another 20% to whatever the price would be. Now and we actually just launched a subscription service this in January focused on the home auto and home lending space. So we had a couple of clients talk to us. We did a couple of projects in that space over the past couple of years, so we pretty much knew it was going to be well-received by our clients and that we would do it. We, we pre, I think marketed it. But we got some buy in and said, yeah, the concepts right now we’d be interested, but it was never a firm commitment. And so this time we actually started out just we underwrite it on ourselves and we just did the research and we knew that it would happen so. 

Greg Alexander [00:07:02] Okay. And the way you monetize it is it’s a monthly subscription all-you-can-eat or is it they buy an individual piece of research?

Michael Ellison [00:07:11] So the way we do our work, it’s it’s a social it’s kind of an all-you-can-eat subscription. There’s a number of different deliverables into the work that we do. We have monthly reports, quarterly reports. We’ve got sometimes depending on it, we might have a bi-weekly readout. So there’s, you know, there’s some data components like Excel matrices or dashboards that we sell. So there’s usually probably 3 to 4 different deliverables and then, you know, content delivered throughout the year. So it’s an annual subscription.

Greg Alexander [00:07:42] Okay. And is it just reports or are you doing things like webinars and things of that nature?

Michael Ellison [00:07:47] Well, we use webinars from a marketing standpoint, so we’ll we’ll do that as part of sort of industry awareness, but we will often package it like they’ll have as part of the subscription, they’ll have access to our analysts and it’s not metered necessarily. You know, if it starts getting abused, we’ll push back a little bit, but they’ll have access to analysts. We might do quarterly readouts for certain clients, things like that. It’s sort of a way because quite honestly, we now use those things to then land some custom work. So once you’ve got them hooked on on the subscription, on the syndicated work, you know, they start having a wait, we’ll actually want to take this. And do you know, can we look into this issue that’s not directly covered? And we use that as an opportunity to then add custom opportunities to it.

Greg Alexander [00:08:35] Okay. And you mentioned access to an analyst. So our members are going to ask you this question on the Friday Q&A when we get it scheduled. How do you staff something like this? Is it are you hiring consultants? It doesn’t sound like it. It sounds like you’re hiring analysts. So describe the role for me.

Michael Ellison [00:08:51] Yeah. So we have. And you’re right, it’s analysts and, you know, I’d say our consulting works probably not your traditional management consulting. We are not looking at the problem, finding the solution and telling it, telling the C-suite what direction to take their business. Right. It’s custom research offering and there’s consultative elements to it. Like we’ll make recommendations and things we need to do, but we’re not really concerning ourselves with actually how to go about doing it. Mm hmm. So the people that we tend to hire, it’s you might say it’s kind of that traditional pyramid, though, right? We hire a lot of people right out of school. We teach in the industry that that we cover. And we’ve got certain methodologies around how we gather our research. And and some of the more fundamental, key elements to it are what you start out with. And then as you get a little more experience within each industry or a vertical that you’re in, you write a little more research, you do a little more thinking, you do some blog posts, you do your own client calls and things like that. So our average age from our analyst team is probably in that late twenties. Mm hmm.

Greg Alexander [00:10:00] And average salary ballpark.

Michael Ellison [00:10:03] I think we start people in the 60 to 70 range and then, you know, they’re probably in their, you know, high nineties, low hundreds as you get. Okay. And it just for context we’re New York City based.

Greg Alexander [00:10:16] Okay. So the model there, the labor model, the expense model is lots of people, 95 people younger, less expensive, but lots of them. Whereas in a traditional consulting world, it’s a little bit more top heavy than that, you know. In fact, at the top of the pyramid, you might have million dollar earners and they’re keeping an army of juniors busy. So it’s a different it’s a different labor model because the work they’re doing is different. That makes sense, I would imagine, based on the way you’ve described it, almost all or a high percentage of your revenue is recurring.

Michael Ellison [00:10:53] Yeah, it’s in the 65 to 75% range is recurring. Yeah.

Greg Alexander [00:11:00] Which is the reason why most of our folks that have not productized want to productize because some of them, unfortunately, 0% of their businesses recurring every year. They start the year January 1st at zero. And you know, at some point when you get to a certain size, that’s really hard. So having some recurring revenue is really nice. And that’s the whole idea of today’s show, which is this is this is one way to productize expertise. And maybe it’s not the only way, but if you can start doing this, given Mike’s advice today, you can start building some recurring revenue into your model though. Mike, you’re also doing some consulting work and most syndicated research shops offer that, but it’s a certain type of consulting which you hinted about earlier. Can you describe for us what that looks like?

Michael Ellison [00:11:46] Sure. So let’s say in the syndicate a report that looks at the banking space, we might do one of our monthly reports might be on the online bill payment capability, and we’ll compare and contrast. And within each vertical, we have, you know, 20 to 25 industry players that we routinely track our coverage set. And we’ll compare and contrast how each firm offers that know, in this case online bill pay. And we’ll look at, you know, strengths and weaknesses and so forth. And we give some high level recommendations about usability and things like that. But one of our clients might be like, you know, this is really interesting and we’re actually planning to build out this capability for our customers next year. But, you know, we also want to see not just what you guys did here, but how does it compare to firms that you might not cover on a regular basis? Or we want to add in some UX actual UX testing based on some of the work that we’re we’ve done to date. So they would hire us to really build out really on that topic, or it could be something else entirely that they can do, but it’ll be like, here’s kind of what we’re trying to understand. How does our feature, our service compare to this particular set of customers that you may or may not track on a routine basis? And we’re really looking for recommendations in improving the overall UX experience, maybe not just functionality.

Greg Alexander [00:13:06] Okay. So it’s very, very so it’s related to the research that you’re doing. It’s building off of that. So it sounds like everything everything comes back to the research, whether it’s custom work off the research or consulting work of the research. Is that correct?

Michael Ellison [00:13:20] Correct. Yeah.

Greg Alexander [00:13:21] Okay. Got it. And how do how does somebody take a service like this to market?

Michael Ellison [00:13:30] Well. That’s a good question. And we the way we do it, we actually have a sales team. I mean, we have and it’s grown over the years when it was my dad who actually started the business and I joined him as employee number one. And, you know, I did the work and he sold it. Then I hired an analyst and I started selling. So it was very much, I think, a product-oriented sale. And as we’ve grown, you know, now we have, I think, five, eight years to customer success. So we’ve kind of built a sales organization within it. And I think that’s probably one of the benefits of selling a product, if you will, versus selling a consulting thing, because we can teach our salespeople what the value propositions are and who we know, who we want to speak to and everything like that. It’s the sale isn’t predicated on their own internal industry expertise.

Greg Alexander [00:14:23] Yeah. My last question for you, Mike, would be, if somebody wants to go down this path, any landmines to stay away from?

Michael Ellison [00:14:32] Yeah. With us. You know, one of the things that it can, you know, data ownership I think is one big one, right? You want to make sure that you can sell what you’re selling from a you know, in that you’re protecting your own business and. It’s also like your clients are going to see everything, like they’re going to see the same thing. So, you know, what Merrill Lynch sees is the same thing that Citibank sees or what have you. So I think your message has got to be consistent. And one of the problems this was a growing pain for us is particularly if you’ve got kind of a hybrid product versus custom, you got to make sure everybody’s playing from the same set of rules and expertise. We had something where we had our our analyst in and one of our syndicated packages were making recommendations that contradicted what the analysts on the consulting side of things. So we had to do some reorg after that. So I think it’s make sure you’re all you’re all preaching from the same pew. Yeah.

Greg Alexander [00:15:35] Awesome. Well, listen, on behalf of the community, it was great to talk to you today. This is your you’re different than most of our members in the sense that you’ve started off with a productized service, if you will, and our members are trying to get there. So your your story was really illuminating today. Thanks for being here.

Michael Ellison [00:15:52] Thank you. Glad to be here. Thanks, Greg.

Greg Alexander [00:15:53] Okay, So some takeaways for the audience. So if you’re a member, be sure to attend Mike’s Q&A session when we get it scheduled. If you’re not a member and you want to become one, go to Collective54.com and fill out the contact us form and one of our reps will get in contact with you. If you want to consume additional content, two things to try to do. So first would be Collective54 Insights, which is our weekly newsletter. If you subscribe to that, which you can do on the website, you get three things every week. You get a blog on Monday, a video on Wednesday, and a chart of the week on Friday. If you don’t want to do that and you want depth, you know, meaty stuff, spend a few hours with something, check out a book. It’s called The Boutique: How to Start, Scale, and Sell a Professional Services Firm. Take about three or 4 hours to get through that. Alright. Great episode today. Thank you all for listening. And until next time, we wish you the best of luck as you try to grow, scale, and exit your boutique professional services firm.

Episode 117 – How a Staffing Firm Productized a Service and Is Changing Lives – Member Case by Nish Parikh

Productizing a service seems scary and many Founders of service firms do not know where to start. As soon as you have decided to capitalize on it, productizing your service can lead to fast growth and large scale. On this episode, Nish Parikh, CEO at Rangam Consultants, funneled cash from his staffing firm into the development of a product called Talent Arbor. As a result of this innovation, Nish is helping those on the Autism spectrum build rewarding careers. Join Nish and hear how leading with empathy drives innovation and impact.


Greg Alexander [00:00:15] Welcome to the Pro Serv Podcast with Collective 54, a podcast from leaders of thriving boutique professional services firms. For those that might not be familiar with us, Collective 54 is the first mastermind community dedicated to the specific and unique needs of leaders of boutique professional services firms. My name is Greg Alexander. I’m the founder and I’m going to be your host today. On this episode, we’re going to talk about productizing a service and how by doing so, you can accelerate your growth rate and accelerate the pace of scale. And we have a great role model with us who is someone who just did this. His name is Nish Parikh. And Nish, welcome to the show and would you please introduce yourself to everybody? 

Nish Parikh [00:01:04] Sure. Thanks, Greg! Nish Parikh, I’m co-founder and CEO of Rangam Consultants. We are a workforce solution company with the expertise in the DEI space where we are helping companies build, scale up, and manage their disability hiring programs and neurodiversity programs. 

Greg Alexander [00:01:28] Okay, very good. So today we’re going to talk about how you just productize a service and you created this thing called Talent Arbor. And let’s start with just briefly. What is it? Please. 

Nish Parikh [00:01:45] So Talent Arbor is a tech-enabled workforce solution for companies with interest in bringing in holistic talent. Talent with all abilities. And this platform is helping companies identify the jobs for this type and job in different roles to manage the complete end-to-end program when it comes to hiring people with a disability or people of neurodiversity talent. 

Greg Alexander [00:02:21] Okay, now you ran your company for many years successfully without this product or a product, I might say. So why now? Why did you decide to productize your service now? 

Nish Parikh [00:02:39] What we have experienced. There are two two components or there are two needs. We saw about two years ago. One is managing our services. When we are serving our customers with neuro-typical candidates and neuro-diverse candidate, we were managing in two different platforms, two different applications, two different processes. So I saw it first-hand and we said, How do we manage this? The back end of our services, utilizing a product, one platform. And then our customers started asking if they can do certain things, which was part of our platform. And that’s when this whole idea of productization started. And then in recent, during COVID time, we saw another opportunity where self-service model in this particular space is becoming more and more, you know, adaptable, are, you know, successful. So that’s another reason we said how do we take what we have built and build a cookie cutter kind of a model where we can replicate this and offer this services as a cost effective solution to our customers? 

Greg Alexander [00:04:04] Fantastic. So for listeners out there, this is a very typical journey towards productization. It starts with you’re performing a service for a client. You want to do it more efficiently. So you tech-automate your service delivery, deliverable delivery, excuse me, tech-automate your service delivery. And that’s a tool that you use internally to perform the work. And that alone can significantly improve scalability and, quite frankly, profitability. Then very often you then make that platform after it’s built available to clients and they start using it either in exactly the same way or slightly different ways, and then it opens up new revenue streams. In this case, the self-service revenue stream. And then that is almost another multiplier of scalability. So this is why it’s it’s such an effective way to scale a professional services firm whenever you can automate. Now, a lot of people that may be listening to this are going to say, Yeah, I get it, but I don’t know how to do this. So I’m assuming at one point in your journey you didn’t know how to do it. So how did you get started and how did you pull it off? 

Nish Parikh [00:05:12] Yeah, So we started we, we brought this whole process of cost productization into two parts. One is our team facing functionality. How do we first build that base so that we can we can serve our customers in a cost-effective way. So once we solved that problem, then the real process of productization started. So in that process, what we consider we created a one-year roadmap. And our first launching pad was something where customers were asking us for this particular type of activity every single day when they start the program. And so we identify those couple of activities and we we created the model for that. And now we have started chatting and offering these services as an add-on to existing services. So we have taken this multi-phased approach. So as we are building, we are going to go to the market and enhancing our existing services with our existing customers. But with the goal to offer these services as a brand new services to new customer. Once the complete platform is ready. 

Greg Alexander [00:06:36] Okay. Now productizing the service is expensive. And it’s risky. So therefore, especially if you haven’t done it before, it’s. It takes courage to do that. So how did you muster up the courage to go down this path? 

Nish Parikh [00:06:58] So in my. Entrepreneurial life I how I’ve been. Pretty unsuccessful. Couple of times in. So the courage was always doing that. And no matter what, because I’m going to fail, I’m going to take it. But the difference between all my earlier ventures where I have failed. I went a little bit out of the scope, out of my core business. So my first product was e-commerce product, which is completely different than staffing. Then my second product was on the education side, special education, which is kind of related to staffing and employment. But the benefit that this particular product, I see that what we are selling to our customers, our core customers, sixty customers, they are looking for this solution. So this particular fit is or this particular productization projects as compared to my previous. So that’s that’s how I see it, that there is the higher possibility of success. 

Greg Alexander [00:08:09] Just a great reminder, you know, stick to your knitting, you know, stick inside your circle of competence, you know, and if your customers are asking you for something, listen to them. Build them what they want and they’ll probably buy it. You know, it’s just just great advice. You know, I think some of our members don’t understand the term neurodiversity, which I know is how you’re building your firm and it’s your passion and your mission. Would you mind explaining what that means? 

Nish Parikh [00:08:35] You know, we all have way to do things. This is very simple. This is how I have a learning experience. Neurodiversity is when we bring in the workforce who has the building ability to think out of the box. We are all influenced by so many things, but neurodiverse is like considered individuals on the autism spectrum or ADHD. ADHD is also. And then there are a lot of other mental I would not call it disorders, but you know, we call mental conditions where these individuals, they think differently, they see the world differently. And that’s the beauty of neurodiversity. 

Greg Alexander [00:09:26] Okay. And you’re helping companies place neurodiverse people into jobs in their company said, I understand that correctly. 

Nish Parikh [00:09:37] Yeah, that’s like blitzing is only one piece because this is where a lot of people they. Because hiring people with disability or autism or neurodiverse is not new sustaining. That’s what I always say. We help companies sustain this talent and so that they are successful. That’s what we really do. 

Greg Alexander [00:09:56] Okay. And this Talent Arbor system along with your other services, is is managing the lifecycle of that employee. So it’s not just placing it, but making sure they’re successful, you know, throughout their career. 

Nish Parikh [00:10:11] That’s right. That’s right. It starts with identifying the right job. Okay. Using AI and machine learning, to setting up those trainings, capturing those checkpoints, onboarding the candidates, and then most importantly, sustaining them in one-connected as the one-connected community. 

Greg Alexander [00:10:32] Okay, very good. So that was helpful to understand the context of our story of prioritization today. Just a couple more questions for you. The other obstacle that founders run into is they say, Yes, I understand I need to do this, but I’m already too busy. And productization is a big project. I don’t have time for this. And when I look internal to my team, you know, maybe everybody else is just as busy as me. Or maybe, you know, if there is extra capacity, you know, they’re not skilled in, you know, turning a service into a product. So how did you find the time to do this? 

Nish Parikh [00:11:10] Yeah. So in our case, we were we were fortunate that one part of the team was already serving. Our internal tech team was already working on building this innovative thing, which was helping us compete with other competitors. So that was already there and that development expertise was there. So I would say we were fortunate to have that one core competency built in in the organization. 

Greg Alexander [00:11:42] Okay. 

Nish Parikh [00:11:43] And then then second is the second step is then allocate some additional resources to take that product to the next level. And one of the other very important thing, which we we did was we kind of mandated or kind of everyone contributed there 5 to 10% of their time in building this solution. So we created a dedicated innovation team and who met on a weekly basis to all the subject matter experts within the organization. They come to this call, they look at what we are building, and they provided their feedback. So it was a collaborative effort and that’s how we’re kind of building this the next towards the end of this platform. 

Greg Alexander [00:12:34] Okay. So I understand how you’re investing kind of non billable hours is 5 to 10% into the building of the product. I’m also assuming that you were probably taking profits generated from the service business and funneling that into this prioritization. Is that correct? 

Nish Parikh [00:12:51] Absolutely. So we are using our free cash flow and we are reinvesting into additional resources to take the product to. Yeah. Okay. 

Greg Alexander [00:13:01] So were you able to fund the entire the entire development effort from the free cash flow from the service business? 

Nish Parikh [00:13:08] Yes, that’s what we have done so far. But we are out in the market kind of looking for external. It’s not enough to to expedite because time is, as you know, great. And we want to go to the market as quick as possible. So. 

Greg Alexander [00:13:25] Well, good luck with that. I know it’s not a friendly funding fundraising environment at the moment, but hopefully things will get better here. So, listeners, this is an important thing. So, you know, he had a choice to make. You know, the service business was thrown off free cash flow and he could either stick in his bank account and take some trips and buy some cars and things like that, or he could reinvest it back into the business to try to, you know, accelerate scale and grow. And that’s what he did. And you’re able to do this at least a version of it, by using your existing free cash flow. And there’s lots of advantages. Topic for another day to do that. My point in saying this is that it’s not impossible. It’s very doable. It’s not like you don’t have to go raise $100 million to go do this. I mean, you’re not a software company that needs venture capital money. You’re trying to tech automate, which is a different scope altogether. So the money and the time is there. And I want you to encourage you to try to make it happen. All right. Well, listen, we’re at our time window here, but I want to. For all the members, on behalf of all the members, I want to thank you for being with us today and tell us a little bit about your story. It’s a great, tangible example of how a service company has productized and the journey that you went on, and I wish you the best of luck with Talent Arbor. 

Nish Parikh [00:14:44] Thank you so much. Thank you, Greg. 

Greg Alexander [00:14:47] Okay. A couple of call, two actions for the group. So if you’re a member and you’re listening to this, be sure to attend the Friday Q&A session that we’ll have with Nish to talk more about this. That’s an hour long session. You’ll be able to ask questions directly of him and they’ll be a wonderful learning opportunity. Also, if you’re participating in the new e-learning products that we’ve come up with that support, the two books, The Boutique in the Front, A Bottleneck within the Boutique Companion course is a couple of tools I might direct your attention to. So the first one is a vision templates. So clearly Niche had a vision for what he wanted to do. So you need a vision to figure out where you want to go with your prioritization efforts. And then you double click on that. And there’s another template called the Service Roadmap template. So those two things might help you get your thoughts organized. And I wanted to direct you to those. If you’re not a member and you’re listening to this podcast in the public domain. You want to consider joining, go to Collective54.com. That’s obvious. Fill out a contact us form and somebody will get in contact with you. However, if you’re not ready to join but you want some more contact, you can subscribe to Collective 54 Insights and you’ll get three things on Monday. You’ll get a blog, on Wednesday you’ll get a podcast, and on Friday you get a chart. And it’s a good way to educate yourself further on these topics. And maybe that’s a way to get started in the pathway towards membership. Okay, So thanks for listening. This was a great episode and until next time, I wish you the best of luck as you try to grow, scale and exit your service for.