'The perpetual evolution of financial crime necessitates an equally dynamic response from...
#9 Establishing Valuable Analyst Relationships
This Paper is for those looking to gain more value from their analyst relationships and those seeking to establish analyst engagements.
There are some uncomfortable truths discussed.
Please reserve judgement until reading the entire Paper.
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1/ Introduction
Anti-financial crime (“AFC”) software providers and practitioners routinely seek out market intelligence, strategic recommendations, and product insights to achieve growth objectives. Analyst firms attempt to service these needs. These firms can offer pathways to greater visibility with buyers for software providers and, conversely, highlight helpful solutions that practitioners may not have been aware of.
As with any collaboration, not all analyst firms are created equal. Selecting the right one—with genuine expertise, a transparent methodology, and a proven track record—can make the difference between a valuable partnership and a costly (or even misleading) mistake. This Paper examines the critical factors that both AFC solution providers and practitioners should consider when engaging with analyst firms.
2/ What is an ‘Analyst’ and what is their role in the Anti-Financial Crime Ecosystem?
‘Expert’, ‘Research’, ‘Advisor’ - different firms give analysts different titles. I have consistently viewed analysts as something else - a strategic resource. Traditionally, they provided analysis of a topic, industry, market segment, etc. Increasingly, analysts and their firms have expanded their services, repositioning to an à la carte menu to increase their client base and expand market share. As Norgay sherpaed Hillary, analyst firms vie to establish themselves as the guide of choice in a crowded field. Through the anti-financial crime looking glass, we see typical use-cases emerge.
I. Practitioners: Between building an AFC program and the day to day operations, little time is left to explore program augmentation and technological advances. We practitioners are a proud bunch and have been burned too many times by false software promises and consultants who borrow our watch to tell us what time it is. Who do we turn to?
A neutral third-party with expertise and a focus on testing, reviewing, and ranking solutions might be a good start. So we use analyst firms as a compass, navigating through program management challenges and software exploration. They also become a validation. Similar to investment firms hiring gold-plated strategy consultants to guarantee board approval, practitioners will leverage analysts for independent confirmation of their decision making.
II. Software Providers: The holy grail is the top-right quadrant of any report. A digital award with “best in class” only sweetens the pot. Brand recognition and market visibility are the primary drivers for software providers to shell out, at times, >$100k per annum to analyst firms. This recognition and visibility is then sold to the aforementioned Practitioners looking for guidance on a software world they do not have the time, resources, nor capacity to explore. It doesn’t stop here (we’ll get into more detail later), but it certainly starts here, driven by marketing-owned budgets.
3/ Key Considerations (and Perils) When Choosing an Analyst Firm
In our attempt to define an analyst and their role we listed a few benefits to the main clientele. Despite these benefits, practitioners should resist treating analyst reports as the ultimate or exclusive source of truth. Any single analyst report or ranking system is inherently limited by the firm’s own methodology, expertise, and business model. Practitioners need to conduct additional due diligence to ensure that the solution they select aligns with their specific compliance requirements, organizational structure, and risk appetite.
And in their blinding sprint towards a prestigious position in an analyst’s report, software providers would do well to slow down and widen their gaze. There is tremendous value in what some of the firms offer.
Here are the do’s and don’ts when choosing an analyst firm to work with:
Do |
Why? |
Don’t |
Why not? |
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1. Prioritize depth of the analysts’ practical anti-financial crime expertise |
The best insights frequently come from former practitioners—compliance officers, financial crime investigators, AML and fraud specialists—who deeply understand the complexities of KYC, sanctions screening, transaction monitoring, fraud prevention, behavior, identity, and regulatory reporting. Similarly, former product leads with hands-on software development experience can credibly judge the feasibility and maturity of proposed product features. If they’ve never worked in the industry, how well do they understand your world to provide “expert” guidance? |
1. Trophy chase |
Software Providers -> If all you’re paying for is a top-right position on a grid, or that “best in class” award that’s bestowed upon 12 other report participants, you’re perpetuating a negative value engagement and leaving loads of opportunity (that you paid for) unrealized. Practitioners -> If the ‘insights’ you’re getting and the names you’re provided are the same as last year's, which were the same as the year before, you’re asleep at the wheel. Do your homework on the expertise of the analyst firm and what they truly specialize in. Don’t chase the name. Don’t trophy chase. |
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2. Ask about conflicts of interest |
We have noted that analyst firms derive revenue from both practitioners and solution providers, creating potential conflicts of interest. While neutrality is the professed standard, in practice, lines can blur when incentivization rises. Do not hesitate to ask how this is managed/mitigated. |
2. Take everything at face value |
This ties into #1 in the “Do” table. If the analyst lacks substantial AFC expertise, their ‘recommendations’ and ‘strategic insights’ may misdirect internal teams, product roadmaps, and/or spending. This delivers tainted data from which strategic and operational decisions are based on. |
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3. Ensure any rating methodologies are transparent. |
An honest, clear explanation of the analyst’s methodology—what data is collected, which stakeholders are interviewed, how scores or rankings are derived—helps ensure that clients can interpret the firm’s findings accurately and fairly. Firms that hide behind opaque processes may produce reports that primarily reward those who pay for premium services or who have stronger marketing influence. Give “secret sauce” and “proprietary technology” no quarter when the stakes are this high. |
3. Set it and forget it, nor take a sporadic approach |
The true value in analyst engagements are the relationships you build that enrich your firm’s ability to achieve its growth objectives. One-off requests breed one-off results. And if you don’t put in the effort to establish rules of engagement, ongoing dialogue, and align on desired outcomes and a path to get there, don’t be surprised when internal questions arise as to the wisdom of your analyst firm budget spend. |
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4. Cost-consciously leverage the wider suite of services |
Analyst firms have expanded their services beyond traditional engagements. Some have even developed their own technology to support your needs. These relationships often involve significant financial investments. It’s important to understand and budget up-front what the obvious and not-so-obvious costs will be. Equally important is the value derived from services already included in your contract that you’re not leveraging. And always consider whether the analysts truly add insight, foster industry connections, and/or contribute to your objectives in a meaningful way. |
4. Ask for expert advice from a non-expert |
Just because the analyst firm offers services a market needs doesn’t mean they offer THE services YOU need. Some are experienced in specific fields, others in others, and so on. Do your homework before asking the information security expert to advise on your transaction fraud prevention product development. |
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5. Perform due diligence |
You are not the first and won’t be the last client of this analyst firm. But you can save yourself from a potential costly mistake with long-lasting consequences if you simply ask your network. What’s their track record (case studies, Analysts’ backgrounds, references)? What’s the quality of their previous research? Do they demonstrate evolving understanding of new regulations, typologies, or compliance frameworks? What’s their industry involvement look like? Having built and led successful analyst relations I help my clients avoid common mistakes and extract the most value, of which there is plenty when executed properly. |
5. Partner with everyone |
The ‘spray and pray’ or ‘shop around’ approach to analyst firm relationships are like any relationship, doomed to fail. Hope isn’t a strategy. Develop a strategic approach to your analyst engagements and reap the rewards. |
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4/ Crafting a Balanced, Informed Analyst Strategy
I’ve seen firms burn hundreds of thousands on annual engagements with no clear strategic intention nor defined objectives. Don’t be them. Here are some tips to achieve your growth objectives:
Practitioners:
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Diversify your portfolio. Seek multiple perspectives and never rely on one firm, analyst, nor report to backstop your decision making.
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Challenge conclusions and visuals. Everyone loves a picture, but what does that really tell you?
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Confirm that you will receive custom insights tailored to your organizational profile and risk appetite, not just generic market overviews.
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Software Providers:
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Clearly define what you want to achieve from paying for analyst engagements. This looks like pen to paper, proper strategic planning with quantitative and qualitative outcomes. No slide decks dominated by pictures and whimsical lead generation figures.
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Product, Marketing, and Revenue should all be actively engaged with analysts. If they’re not, you’re leaving money on the table.
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Analysts are an extension of your teams that you’ve already paid for. Put them to work.
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5/ Conclusion
Analyst firms remain a powerful force in guiding decisions, shaping brand reputations, and helping both software providers and practitioners navigate the AFC technology landscape. Yet, not all analyst engagements are created equal. Critical, independent thinking—coupled with verification of an analyst’s real-world AFC expertise—can significantly enhance the value of these partnerships. Software providers seeking to expand their market footprint and practitioners striving to make informed purchasing decisions should choose analyst firms who combine deep domain knowledge with balanced, rigorous market reporting. In an environment where costly mistakes have regulatory and financial repercussions, selecting the correct partners that can illuminate (rather than obfuscate) the path forward is an invaluable strategic advantage.
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