Secretive Expert Network Industry Sees Soaring Venture Capital Investment

Fat profits and innovative technology drive approximately $350 million of venture investment into the sector during 2021.

After years of soaring growth and hefty profits, the discrete expert network industry is suddenly one of the hottest sectors for venture capital investment.  Rapid industry growth, fat profit margins and a handful of noteworthy liquidity events are enabling a number of technology-focused upstarts to amass significant war chests. 

What are expert networks?

GLG consulting invite
Spend much time on LinkedIn and you’ll probably receive invitations to consult with expert networks like GLG, which recently filed to go public.

Expert networks facilitate deep and rapid research into a company, product or market by connecting their clients – mostly investment managers and management consulting firms – to ‘experts’ with significant and current knowledge of the research subject.  Expert network consulting is frequently used to shape investment decisions, conduct due diligence or set strategy recommendations.

The experts are usually former employees, customers, competitors or key influencers (such as doctors or former government officials) of the research topic.  The typical consulting project is a one hour call between the expert and the client, where the client will want to rapidly download the facts on the ground from people who know the company best.  

Many firms charge clients $1,000 or more to facilitate these consulting calls, with experts often earning hourly rates that can regularly exceed $500.  Many firms also regularly coordinate paid business surveys for clients.  (If you’ve spent much time on LinkedIn, you’ve probably been approached to participate in a paid consulting opportunity with an expert network company.)

The expert network industry was born in the late 90’s, with pioneers GLG and Primary Insights taking advantage of an SEC crackdown on the sell-side research practices of invest banks, following a number of scandals.  The firms grew rapidly by directly connecting investors with executives with firsthand knowledge of the companies that they were considering investing in.  However, the young expert networks soon found themselves at the center of several major insider trading trials and making unwanted headlines of their own.  

While these high-profile cases seemed likely to kill off the industry, it instead responded by building large compliance teams tasked with implementing more rigorous compliance policies and monitoring for clients.  Compliance became a feature to sell to clients (and help justify sky-high pricing).

The industry returned to steep growth over the next decade, with over 100 new firms sprouting around the world.  It remained mostly out of the public eye, with a just a handful of early stage venture capital investments or late stage private equity deals — until the dealmaking floodgates opened at the start of this year:

A dozen firms reported approximately $350 million in venture capital investment this year:

So what’s driving the sharp increase in venture capital dealmaking?

Most of the capital investment went to firms developing technology to better identify and source new experts and streamline the process of matching experts to client’s project criteria.  This should enable firms to scale without hiring armies of recent college grads to endlessly scour LinkedIn for qualified profiles.  Several firms are also shifting towards self-service marketplaces for clients to select and staff experts on their projects at a fraction of the cost of traditional expert networks.

While a new firm seems to now be born every week – many of them touting more competitive pricing – the industry remains enormously profitable.  Many firms still charge $1,000 per hour or more to speak with an expert.  GLG, the largest firm in the industry, revealed eye-popping 73% gross margins in its recent S-1 filing.

The expert network industry reached $1.9 billion in revenue in 2021.  It has recorded double digit growth annually since 2015, with growth accelerating to 20% during 2021.  Two expert networks made the top 20 list of the highest paid investment research providers for the first time this year.  Meanwhile, a number of firms continue to make inroads into the corporate strategy market, which dwarfs the size of the industry’s traditional investment manager and management consultant customer bases.

While most firms in the industry have long been closely held, several firms established a path to liquidity in 2021.  GLG recently filed for an IPO, where it expects to raise $100 million, and Capvision has also filed to go public on the Hong Kong stock exchange in early 2022.  VisasQ debuted on the Tokyo Stock Exchange in 2020 and recently acquired industry stalwart Coleman Research for $102 million, perhaps kicking off a long awaited bout of industry consolidation.

Arbolus Technologies Review

Have you been contacted by an associate from Arbolus Technologies via LinkedIn, email or phone call with an invitation to participate in a paid consulting engagement? Are you wondering if it’s a scam, or a legitimate opportunity? Our Arbolus Technologies review details what to expect, and how to land high paying hourly consulting projects.

What is Arbolus Technologies?

Arbolus consulting logo

Arbolus is an expert network, a custom recruiting firm focused on connecting subject matter experts (SMEs) with institutional investor clients looking to better understand an industry, company, or product. Expert networks typically rely on LinkedIn and company websites to identify current & former employees, competitors, customers, and key opinion leaders who can add value to a client’s market research via their professional experience and opinions. A subject matter experts’ expertise is typically rapidly downloaded via a 45 minute to 1-hour call with the client. Working with Arbolus, and other expert networks, can be a lucrative alternative stream of income, requiring little to no preparation, that can be scheduled around your existing employment or other responsibilities.

Founded originally as CiQ Group in 2017, the firm was rebranded as Arbolus Technologies in 2019. Arbolus was founded by two managers from AlphaSights, Sam Glasswell and Will Leeming. The firm has been experiencing rapid growth, acquiring Waterside, another budding expert network, in 2019. The Barcelona-based firm also maintains offices in London and New York, and raised $6M in venture capital investment from Fuel Ventures and Plug & Play Ventures in 2021

Arbolus transcribes calls between clients and experts, adding them to a library that is available to its entire client base.  (Other emerging expert networks, such as Tegus, proSapient and Stream by Mosaic offer a similar product to clients.)  Experts do not receive additional compensation if clients access transcripts of their calls.

In addition to traditional expert network services, Arbolus operates a software platform called Hyperion that utilizes machine learning and NLP for higher quality and more efficient matching of clients and experts. Their platform allows clients to stay connected with experts they have worked with on previous projects, as well as access reviews and client call history for experts in order to develop a sense of trust and connectedness to expert connections.

Is Arbolus Technologies a scam— or a legitimate opportunity?

Arbolus — and expert networks in general — are not a scam. Expert networks are a $1.9B industry, and typically serve as a professional service for the financial services industry by sourcing subject matter experts for their clients. Arbolus serves a wide variety of clients, from start-ups & corporations to consultancies, hedge funds, and private equity.

Typically, associates from an expert network will use LinkedIn, or publicly available contact information such as email or phone number, to recruit potential experts for a project. You can optimize your LinkedIn profile to increase your chances of being recruited for a project by expert networks. Expert networks are an extension of the gig economy and are a great way to monetize your professional experience!

What to expect if you consult with Arbolus Technologies

Arbolus consulting reviews

Recruiters for expert networks rely heavily on LinkedIn to identify potential experts for a project based on their employment history. If, based on your LinkedIn profile, the associate believes you could be a good fit, they will reach out you with a brief introduction to themselves, their firm, and the project.

If you’re interested and think you could contribute to the topic, the associate will invite you to fill out a profile and questionnaire on their platform. The profile will cover all the basic questions about your employment history and expertise, in addition to project-specific vetting questions. For the vetting questions, you should know that the associate is not expecting the type of in-depth answer that the client would like to have in the call. Instead, your answers should be a sentence or two demonstrating your knowledge and ability to speak to the topics of interest. You will be asked to review a compliance document to make sure you understand that no propriety or confidential information can be shared during the call. You will also be able to set your rate and availability at this time.

The Arbolus associate will then submit your profile to the client for review. If the client chooses to move forward with your profile, you will receive a calendar invitation with dial-in information for the call. While the review and scheduling process usually takes only a few days, it can take up to two weeks. 

If you don’t receive a calendar invitation within a week or two, it’s safe to say your profile was not chosen. Don’t worry— now that your profile is in the Arbolus system, you’re more likely to be contacted for future projects. In the meantime, you can increase your chances of being chosen for a project by following these tips.

Arbolus Hourly Rates

Arbolus— and other expert networks— compensate you for your time and expertise spent on a client project. Sometimes, a starting rate will be communicated to you in the initial reach out. Othertimes, it will be communicated to you in subsequent reach outs. 

In general, you can expect the hourly rate to depend on a variety of factors, including the scarcity of your expertise (how many other experts can discuss the topic intelligently?), how far removed you are from the topic (how many years has it been since you were in the industry?), and how far you are in your career. 

For early career professionals, you can expect to be offered $100- $200; director level or similar professionals can expect $200-$300; anything above director level can easily command rates of $300- $500. Some experts can command fees of  $1000 or more an hour, however, these professionals are often expert network veterans who are at the top of hot or niche industries, or executives at Fortune 500 companies. You can also negotiate a higher rate for further calls.

Setting your rate exceptionally high can also dissuade a client from moving forward with your profile, even if you are a good fit for the project. This is most common in situations where there are many potential experts who can speak to a topic.

Most expert networks will compensate you based on the amount of time you are in the call. This means that even after you negotiate your hourly rate, if you are on the call for less than 60 full minutes, your fee will be pro-rated based on the number of minutes you are in the call with the client. Therefore, it’s best to keep the call going for as long as you can so you can maximize your fee. Similarly, you will be compensated for time spent on the call beyond the agree-upon hour. An extra 15 minutes on a call can easily translate to a higher fee via Arbolus!

How to ace your Arbolus consulting call

You should not feel the need to overly prepare for the call. The client is not expecting a deliverable or a presentation. The format is highly conversational, and you should be able to answer the questions easily based on years of experience in your industry. 

You can expect that the client has come prepared with specific questions as a result of their own in-depth research on the topic they’ve contracted you to speak on. Clients use expert networks to rapidly download industry knowledge (via your many years of experience!) in order to confirm or complicate their  understanding of a company, industry, or product of interest in order to perform due diligence prior to making an investment or strategic movement. The client has done extensive research beforehand and it should make for an interesting conversation.

The types of clients you will encounter are will likely be institutional investors (strategy consulting firms, hedge funds, private equity funds, etc.), however, Arbolus also offers services to corporate and start-up clients. You should know that financial services clients are bound by strict compliance policies that prevent them from soliciting proprietary or confidential information. Client calls are likely always recorded by Arbulus in order to be made available to customers of their platform, so you can expect that the call will be reviewed internally to ensure compliance. It’s rare that you’ll be asked to share any non-public information, and you should decline to answer any questions you feel moves into this territory; clients won’t press you to share things that you shouldn’t.

What’s Next?

Arbolus payments are made via ACH, wire, or physical check. You should be prompted to enter your payment information immediately after the call.

Now that you’re part of the network, you can use the Arbolus platform to participate in further calls by keeping your information up to date and periodically checking in.

If you have not yet been contacted by an Arbolus associate, you can register as an expert on their platform here.

Next: Learn how to conveniently earn hundreds of dollars per hour with our Ultimate Guide to Expert Network Consulting

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