Systematic data analysis has changed the business of scouting for baseball talent, “Moneyball” style. Small-business owners now looking for marketing consultants in Melbourne to sign up for free “benchmarking” services to assess their young companies, based on an analysis of comparable data from their peers. Analytical rigour can help entrepreneurs make better decisions about how to manage their start-ups. Revenue often isn’t a good benchmark for early stage companies. A more crucial indicator may be how customers interact with their product.
Startup Compass, a benchmarking service started last August, lets fledgling businesses submit information anonymously. The service responds with an automated report, including graphs and other explanatory material, that shows how they stand up against other start-ups that have taken the test.
G-Score, another benchmarking service, uses a questionnaire that covers topics such as the start-up’s business concept, management and rivals. Based on their responses, entrepreneurs can see how their businesses rank on a scale of one to four in each of seven categories, compared with others in the same industry.
CompStudy, another benchmarking service, has collected data for 12 years on cash and equity compensation at private companies. Since 2008, the data have been freely available online to those who fill out CompStudy’s survey, allowing entrepreneurs to see how a company’s equity is split as it raises rounds of financing and takes on more employees.
Business marketing Melbourne critics worry that benchmarking assessments could backfire on entrepreneurs if they are overused. Comparing an entrepreneur with a peer group can be risky. Many entrepreneurs are entering new fields, like smartphone apps, cloud-computing services and social media, where there isn’t much of a reference point for gauging their progress.
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