In this interview, I chat with Sascha Eder, CEO of NewtonX.
NewtonX is an emerging B2B sample space player using a unique, AI-driven approach for identifying and custom recruiting B2B respondents. Rather than a panel, they are developing a network of global professionals across sectors and seniority levels that can participate in virtually any kind of quant or qual project while focusing on compensating professionals at appropriate levels and offering additional value-adds for participation.
Innovation like this has been sorely needed in the industry; some of you might remember LinkedIn’s short-lived foray into the research industry, and they quickly withdrew due to myriad model disconnects between them and the broader industry. NewtonX seems to have resolved many of those challenges is creating a scalable, flexible, and value-added approach that is very exciting. That isn’t to say the traditional model of building specialty B2B panels isn’t effective; it certainly is and can deliver immense amounts of value, especially for hard-to-reach populations. However, there are always challenges with an economy of scale and ongoing engagement with maintaining a panel that can be barriers for some, so seeing a fresh approach that side-steps some of those issues is an exciting step forward to broaden the accessibility of and use of B2B research.
I’d also be remiss if I didn’t mention that we recently worked with NewtonX to supplement the client-side sample for GRIT and couldn’t have been more pleased with the results, so I know firsthand this new approach works and works well. Here is the interview with Sascha; I think you’ll find it as interesting and engaging as I did!
This interview has been edited for length and clarity.
Lenny Murphy: Hello, everybody. It’s Lenny Murphy with GreenBook here with another in our CEO series. And all of these are special, but today I’m actually particularly excited because we are talking to Sascha Eder, CEO of NewtonX, who I recently got to know as a company. So this is a very cool thing. Sascha, welcome.
Sascha Eder: Hi, Lenny.
Lenny Murphy: Thanks for making the time. So we’ll dive into why I think this is a cool interview about NewtonX in just a minute. But for those that aren’t familiar with you and the company itself, why don’t you give us a quick overview of who you are and what the company is.
Sascha Eder: Sure, yeah so my name is Sascha. I’m originally from Germany. And so an immigrant. I lived in Europe, Spain, and France, before moving to the US. I Studied at MIT. I made my way to the West Coast and worked for McKinsey for a while in Seattle and San Francisco in the startup world and the tech world, basically.
And then realized that– especially in consulting companies like McKinsey, you have to conduct more primary research, B2B research in particular. And it was very challenging for us to get the right insights and get access to the right professionals to get the insights we needed. And the existing services– even though they’re helpful– weren’t really giving us what we needed.
So we decided to think about a better way to do B2B market research. And so basically, NewtonX is an AI-driven, B2B knowledge access platform. That’s what we call it. And we leverage technology to basically custom recruit any B2B professional in the world, and power with largest enterprise companies with insights, whether it’s qualitative or quantitative– what a B2B needs to make business decisions.
Lenny Murphy: That is very cool. Now so this is why I’ve been excited about this one. I got a random email from one of your sales teams– so by the way, your targeting was pretty good– a few months back, and I thought, Oh, this is really cool. Because of my background– my previous full-service research company rockhopper, we did mostly B2B research.
And at that point in the mid-2000s, it was, if you’re doing health care, that was one thing. There were lots of access to health care professionals. But everything else, there is at that point E rewards, which is now [INAUDIBLE]. They were kind of the go-to until LinkedIn made a Foray into the industry. And then they quickly realized, oh no, this sucks. We’re not going to do this anymore. So they bailed out of the industry.
So it’s been very challenging to find the right population for many B2B researchers, as you know. So when I learned a little more about what you were doing, I thought, OK, now that is really cool defectively. But forgive my analogy, but the way I correlate is there’s things like LinkedIn Sales Navigator and these targeting tools that exist in this platform. So, OK. You’re doing that on steroids to identify the appropriate people based on the target and then custom recruit. Very cool.
And for our audience– so you’ll know– I was so impressed with the idea that we recently worked with NewtonX to supplement the grit survey that just came out of the field. So we thought, you know what, let’s work on NewtonX to bring in 200 client-side buyers of research to supplement the grit sample.
And you guys knocked it out of the park. We were actually looking for data yesterday. It looks fantastic. So really great. You hit the target, exactly what we’re looking for. So I’ve been impressed. And I think it’s something well needed. So there’s my kudos to you from industry-wide and personal experience. Now, what have you guys found as you’ve entered into this space and been growing?
Sascha Eder: Do you mean particularly how do we go about B2B research, or do you mean more about the trajectory of the company?
Lenny Murphy: Trajectory of the company for the moment. We’ll dive a little more into the technology in just a minute.
Sascha Eder: I think the trajectory of the company was extremely interesting. So we started off with this idea. And the moment we reached out to clients, which in the beginning was very organic. Basically, me and a few maybe team members in the early stages just leveraging the network.
And it resonated extremely well to the point where we felt we have put our market fit very early on. And after that, it was just operationalizing the process, where people realized that there’s a true pain point in market research, which is B2B. B2C research is well established. A lot of providers. It’s pretty well penetrated, but B2B, huge pain point.
And I think one of the big reasons why it was such a big pain point is because, very often, it was just B2C research being retrofitted for B2B purposes instead of really dedicating something focused on B2B. Because I think B2B never has the same value in market research that B2C had. B2C had this huge chair, and then B2B came up.
Lenny Murphy: So it’s a small portion of the industry from a revenue perspective, so yeah.
Sascha Eder: Which we strongly believe, by the way, in our vision, It’s going to be much bigger than it is today. Because if you enable it with the right technology, it’s going to open a market that today is not accessible. So basically, any professional in the world and any company need insights.
And if the experience is smooth enough, and you just go as the head of marketing and say, I need to launch this product, but I know somebody out there did it before, you just connect through the connects to that person, and you do B2B research. That’s what we envision the market. So it’s going to be huge.
But that being said, so over the first three or four years, product marketing was there. And then we had organic growth. So what’s very interesting about us compared to most startups, most startups start off, and then all they do is putting their funding into sales and marketing to grow and get visibility.
We didn’t have a sales and marketing team until the beginning of this year. Everything was organic growth, were closer to the market research industry. Our clients were extremely generous in spreading the word and telling their colleagues and industry peers, and clients about us. So that we were growing organically, until we decided this year, well, this is going great. But let’s institutionalize a sales and marketing team to really systematically grow the brand [INAUDIBLE].
Lenny Murphy: OK. So hence why I started getting the emails from you. So that’s when you– pretty cool. So you made an interesting comment about opening up. And I think there’s an analogy here. If you look at the past year, obviously, within qualitative research, the online qualitative for– I was doing [INAUDIBLE] was 2008. I couldn’t give them away.
So, just because it seems as if that we reached a point with qualitative, that now circumstances force somebody to adapt. Scalable solutions were in place already, so when the market was ready, boom, it exploded. And my personal hypothesis is that it’s always been– the industry’s been about 20% qual, 80% quant. And we’re going to see that shift now. Because now, the ability for it to shift at scale exists.
So if I hear correctly, you’re thinking that we’ll see the same paradigm with the correlation between B2B and B2C. That now that a scalable solution, a cost-efficient overall process exists, to enable effective, scalable B2B research that you’ll see greater uptake across the board. Is that a pretty good assessment?
Sascha Eder: That’s a pretty good assessment. I would say two things to that. One, we’re really trying to disrupt the existing B2B market research notion, which is, we take existing about the quant survey like before, and we change the methodology, which increases the quality, and just the approach, and maybe also the timelines.
But at the same time, we’re also trying to just overall change the notion of B2B research, which is– think of it as like a knowledge exchange, almost like a stock market, where anybody has needs of B2B of research. And if you make it easy enough for a platform, then individuals come together and just exchange.
And we have done this, for example, already in the form of these high-end communities, where we put like 20 marketing directors together. And they just brainstorm ideas, and exchange, and come together, and then come up with ideas that help each other.
So if you scale that up, and you think about B2B research, not just as you have to prepare a questionnaire, and then run the interviews and analyze. But it’s more like, on the spot you have a need, you create an exchange. That’s when you have a knowledge exchange in B2B.
Lenny Murphy: So do you envision then owning that additional piece of value that the value chain, rather than just recruiting, but also have the enabling technology for conducting some elements of research, such as those kinds of ad hoc communities as well?
Sascha Eder: Yeah, and we’re already doing that. So we have a big piece of technology, which is an identification of professionals, the recruiting. Then we have our platform that just enables these individuals to come together and then brainstorm together with our clients or among themselves to exchange knowledge.
Lenny Murphy: Very cool. So GLG and those companies better be paying attention then. So, OK. Got it. That’s pretty cool, that’s pretty cool, Sascha. I’m seeing that MIT and McKinsey background. Seeing how that manifests there– So you grew organically. And you did a series A, and you’re about to go for more growth. So what does the world look like to you two years from now? What are kind of the goals that you see if you look at your overall roadmap and trajectory?
Sascha Eder: Yeah, I think I’m seeing two things. So the first one is– as I mentioned– we’re really at a turning point, where we started the marketing and sales efforts. We still get a lot of organic growth, and that’s great. But we really want to institutionalize the awareness in the brand. Because we know, interestingly enough, every single company that has a pilot with us, and that’s why I was so excited to get the results from the grit study that you mentioned.
They are really impressed by the results, so we really let the results speak for Themselves, and then the clients come back to us. And so we’re trying to get this to as many clients out there as possible. And so we really want to grow within the enterprise sector, within the market research sector. And make this technology available to as many people as possible.
The way we think about it right now is we think of it as we are the best-kept secret in market research out there that everyone should know about. But right now, it’s just still relatively small circle, that’s what you [INAUDIBLE]. And so that just shows you the potential.
And so by doing that, we’re really providing a better service for existing B2B market research, whether it’s qual, whether it’s quant, whether it’s online communities, whether it’s hopefully soon again in-person focus groups. So that’s one big area.
And then the other one is really this platform play that we really envision, which is eventually the end vision for us is to create a self-service marketplace. The customer recruiting methodology will allow us to grow our community to get to that point.
And then you really have a marketplace of high quality, top-notch professionals, probably the best in the world, with 40 plus search results in the event, as you mentioned, is like a Google search on steroids that allows our clients to go extremely deep in the profiling and segmentation of the audiences they want to speak to.
But then they have very easy access. They can create them themselves. And they can do whatever they want. Whether it’s one minute, I have this one question, or I want to run this two-hour focus group. It’s completely up to them. And that’s really the end vision that we see going forward.
Lenny Murphy: That is very exciting. And I suspect that there will be many players in the industry who listen to this interview. And you just became an acquisition target for quite a few folks. So for whatever that’s worth, I’ll put that out there.
That’s an exciting journey, and it’s certainly aligned with every trend that I see in the industry. So actually, I was going to ask whether you’re going to move towards a self-service solution. Glad to hear you saying that. That is actually where things have to go.
Now, let’s dive in a little bit more. You’re using the word marketplace versus panel. And I think that is an incredibly important differentiation here. So let’s talk a little more about that difference and how you think about that. Because you’re not in panelizing people, you’re recruiting people and engaging them.
But are you seeing a repeat engagement with some of these, particularly high in demand value folks? IT professionals, for instance, would do what. So are you seeing a migration more towards a management approach, or do you think it’s just this customer engagement, almost gig network, if you will, for these people for insights?
Sascha Eder: Yeah, great question, Lenny. So we don’t really like the word panel for a number of reasons. The way we think about our professionals is more, as you mentioned, the marketplace work. And the reason for that is the following. The way we think is, we believe we understand what it takes to reach a certain type of audience, whether it’s a CEO or a head of marketing or a director of finance.
And we really know what makes them feel appreciated. And we value that time fairly and compensate them appropriately.
And I think that’s a very, very important notion, compared to, I would say the traditional way of a panel, where it’s typically coming from the B2C research side, with extremely low incentives in the $5 to maybe $25 range, where we believe, if you truly want to run a tractor with 100 CEOs of Fortune 500 companies, we really believe that a CEO is going to take a $5 payment or 20-minute survey, and then has the motivation to give high-quality inputs.
And that’s really where we think we’re changing the game a bit because we really make them feel valued. And so instead of saying, hey, we’re going to put you into a panel, we say we’re going to create a community around you of like-minded CEOs that you can exchange with, that you can learn and benefit from. And on top of it, you can share your experience with clients that help them in their– let’s say, cybersecurity approaches and benefit. And in return, we compensate you fairly for it.
And that’s why we think of them as a community rather than a panel. And we think that’s the future. If you think about LinkedIn, LinkedIn did many things extremely well. But I think there is still an opportunity to take a similar concept like LinkedIn, but instead of making it resume-based, you make it knowledge-based. And you create an even more of an exchange among people. And that’s what we’re trying to go towards.
Lenny Murphy: Yeah, that’s very cool. And I’ve often thought I belong to GLG and a couple of those expert networks, and the– yeah, it’s very specialized obviously with my area of experience. But I have appreciated that when I engage in one of those–
My billable rate is $500 an hour. As a consultant, that’s what I bill. And it doesn’t mean I won’t engage in other conversations for less than that. But for that type of engagement, an hour-long consultation with whatever, you know I’m not going do it for $25.
So I’ve appreciated it, but I’ve also seen the opportunities for changing that model and scaling it up. I think there are built-in inherent limits to the existing kind of expert network model.
And it sounds like you’ve reverse engineered that and recognize where those limits are. And then build a solution for it to provide real scale. That’s it when you mentioned that LinkedIn. that makes a lot of sense too. So is there a thought of NewtonX launching something that kind of seems a little more like LinkedIn but based upon knowledge versus resume. Is that a piece that– Yeah, you can answer.
Sascha Eder: Interesting question. I think this goes really back to the self-serve marketplace, which in one form or another will have these elements. And it goes back to what you said earlier. How can we create very engaged communities that are really interested in participating in studies on a regular basis?
But at the same time, when they’re not participating in studies, they have the ability to benefit from being part of this community, which is going to happen in the form of exchanging with other professionals in the industry. And it’s all about exchanging knowledge, learning from each other, and growing together as professionals.
Lenny Murphy: All right. So I just had a thought. And I’m going to make a kit for this. I’m going to put it out there publicly. So the grit has been a challenge for many years for a variety of reasons. But we get it done.
But periodically, we thought, OK let’s– we tried to build a panel in the community. The engagement was so awful. It just wasn’t worthwhile to do that. But I still love the idea of building an engaged community of research professionals that are on demand. Because I love to take that for grit is, oh my God. This is a 20-minute survey, and it sucks. Yeah, because I can’t get you to give me attention, except for twice a year.
So I’ve got to ask you everything I want because it’s the classic user’s problem. So I would love to have a conversation to see what does it look like if we utilize the new next model, specifically to build this community of insights professionals globally.
So there is a follow-up. So audience, I don’t know if it’s going to work or not. But for those who are listening, I hear you. You don’t like taking 20 minute long surveys twice a year. I get it. So maybe there’s a path of working with Sascha [INAUDIBLE] next to do something different. We’ll see where we get to.
Sascha Eder: And working with Lenny, what we hear a lot from our professionals, they like yourself have been experts in other places, where they are also being presented with opportunities. Very often, let’s say your expertise is in market research. You start getting almost bombarded with a lot of opportunities and emails, where one might think, well, this is great. But then only 10% of those opportunities are really tailored towards your expertise, and everything else [INAUDIBLE] discarding it and say, well, this is so relevant for me.
And that’s another big problem where, again, given our very precise search and targeting filters, our professionals are really being presented only with opportunities that really fit their expertise. So when we reach out to them, we don’t bother them. But they know it’s relevant, compared to other places where you get bombarded.
At some point, you also stop looking at the opportunities because you’re like, well, it’s not worth my time at 90% of it’s irrelevant for–
Lenny Murphy: Yeah, now happens all the time. Your LinkedIn pro finder. I get sent LinkedIn pro finder her every other day. And there’s– I think once, there was something that actually I thought, well, that’s interesting, and then I ask, why am I getting this? This is stupid. so yeah, I totally get that and agree.
So that targeting component– I’m going to be costs of time, but without giving away the secret sauce, can you talk a little bit about what drives your algorithm to be so precise from a targeting perspective. How do you work your magic to find people like me that? Look, Lenny is only going to be focused on market research. That’s his expertise. That’s what he wants to talk about? How do you find this?
Sascha Eder: Yeah, yeah, of course. So we, I think, launched it publicly a few weeks ago, so there’s no secret about it. But we’re basically using what we call internally the Knowledge Graph. And the Knowledge Graph is our proprietary search technology.
And, as I mentioned earlier, from the very beginning, we were not resume-based, but we are knowledge-based. And so we really think about, I don’t care so much where you worked and how long you worked there, what I really care about is what do you know? What are your skills? What tools do you know? What products do you know? What is some knowledge you acquired by being in a certain industry or being in a certain company?
So that’s really the angle we take. And that allows us to segment profiles much more granularity than if you just take a resume approach and you say, well, he or she worked five years at Coca-Cola and three years at Pepsi, and you just look at it from that angle. So that’s the first place.
And so, we really specialize from the very beginning when ingesting professionals into our Knowledge Graph to have the structure-based around knowledge. And that’s what allows us to have these search filters that are more granular than what you would have on LinkedIn or in any other place, which gives us a huge advantage.
And then, we have a big data science team in the background that does nothing else than just, on a daily basis, optimizing that flow, which is– we’re looking at huge data sets. We’re talking about 1.1 billion professionals. And so they’re working on optimizing methodologies on being as precise as possible.
So there are a number of data science methods where, for example, if you miss information in certain areas, you can use inference and other statistical models to approximate with what probability that someone knows a certain type of information. So if you do that and you combine that with, then, the infield experience– so when people actually participate in research, what do they actually know or not know– and you have a feedback loop back into your graph, that’s when you start creating real value, because you start creating your own data points around what do people really know.
And that’s what allows us to be extremely precise in subsequent studies and be extremely detailed. So we know somebody knows about AWS Migration, or somebody is using Azure Kubernetes, right? And so, that’s when it gets really interesting– when you start generating your own proprietary data points.
Lenny Murphy: Yeah, that’s cool. So one of my startups, Veriglif, is working on a blockchain-based personal data graph at the individual level, consumer. So I totally get that. We’re looking for correlations around all the link data assets to identify a person based on multiple variables. So, yeah, preach to the choir.
So, I had a question, and now it just lost me. I haven’t been fully caffeinated yet, Sascha. I’m sorry. That is all exciting cool stuff, and I hope that we have a chance to talk more, because I think what you’re doing is really, really, really interesting. And I think the industry’s really going to perk up and pay attention. And let’s follow up on that conversation about targeting the research industry specifically because that’s something that’s dear to my heart too. So before we wrap up, is there anything that you’d like to share with the audience that we haven’t touched on?
Sascha Eder: I would say one thing that we’re very proud of is our rebranding. So we rebranded in March. So if you go to our website, you will see our new identity, which is something we really identify with now. And the reason why we decided to rebrand is really, we wanted to better express who we are, what we do. And we felt like you couldn’t really tell that when you were looking at the website previously. But now, if you go through it, you look at our philosophy, I think it really reflects what we’re trying to do in B2B market research, and why we think we are the best player in B2B market research because we’re really taking an approach that’s so radically different.
And I think that’s what’s really needed in market research. Somebody needs to come in with a fresh perspective. Rethink from the ground up what is required to make this work. Because market research is an industry that’s been around for so many years, and so many great things came out of it, but you tend to fall into inertia if you do things long enough. And so you need to have someone just forget about everything and take a very fresh approach.
Lenny Murphy: Absolutely, absolutely. And I think that we live in that era right now. It’s exciting. Most of the innovation in the industry has not come from inside the industry. It comes from outside the industry, with folks that are reverse engineering and saying, look, there’s a better way to do this, or potentially a better way to do that. And I think you’re one more example of a series of companies that– they’re doing that and gaining a lot of traction and success. It’s an exciting time. It’s not necessarily an exciting time for the traditionalists in the industry, but for everybody else.
And again, if I was still running a B2 B-focused primary research company, I’d be all over you, right? I mean, I wish you had existed in 2009. Because that was our world, and it was challenging to identify these folks. Again, I was so disappointed when LinkedIn– when they jumped in it was exciting, but then– and this is what I was going to mention earlier, sorry– their experience was because the industry was not focused on the respondent experience, the screening process, the way we would structure screeners and screen people out, they tried to influence the others to say, no, you don’t need to screen. We know who these people are. So here, don’t ask screeners. And the industry would not adapt.
So finally, they said, yeah, this is a pain in the ass. It’s not worth it. So they stopped. So here’s the question, a final question. Have you, with your ability to pinpoint screen, are you seeing a change of behavior of your customers to realize they don’t need to go through that screening process the same way that we have done in the past because you can do that up front?
Sascha Eder: Absolutely, absolutely. So completely understand, with everything going on in market research, with fraudulent responses and bad data, that customers are very wary. And they want to make sure they get what they pay for. But that’s really the big differentiator with us, where we tell our clients, look, we know exactly who our professionals are, 100% verified.
We just recently had a quote from a client that said we just removed 50% of the sample from the panels we’re using. You guys were spot on, 100%; we didn’t remove a single person. And that’s the difference. And so, once customers really understand that notion, there is a certain level of declining return with a screener, where you can also screen out good people because nobody’s perfect. And if you have– your screen is too complex, and it confuses people; it screens out people that otherwise would be qualified.
And so, we are working with our clients on optimizing the screeners so that it creates a good experience for the respondents, as much as it provides a guarantee for them to get the right data. Because providing a positive respondent experience also creates re-engagement, higher quality. And that’s what we were talking about earlier. And so there’s definitely a trend towards– if you trust the data enough, and if you trust what’s coming in, you can actually reduce the screener, which also reduces costs for you, faster fielding time, better experience, so there are a lot of advantages if you do it the right way.
Lenny Murphy: Yeah, no, agree. So we could go on for another hour talking about that. We’ll hold that for another conversation. But this has been great. Congratulations on all the success. And again, for anybody out there, we are digging into the data right now from NewtonX. I can tell you that the next data– excuse me– looks better, is cleaner than, from our own internal sample lists, so at within grip. So take that for what it’s worth, but at this point, I’m a believer. You guys did a great job. And so there’s this– you have the Lenny seal of approval. So–
Sascha Eder: Thank you so much.
Lenny Murphy: All right, Sascha. You be well. Take care. And we’ll talk again very soon.
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