Expert networks, which specialize in connecting users to industry experts, are estimated to have grown their revenues over 20% in 2021 as the industry flourishes in the after-effects of Covid-19, according to analysis released by Integrity Research and Inex One, an expert network marketplace and aggregator. The market sizing study, which includes detailed revenue estimates for the 42 largest expert networks over the last decade, provides an in-depth perspective on the expert network industry, which continues to have opportunities for future growth.
Based on firm-level bottom-up analysis, the new 2021 Expert Network Market Sizing estimates that aggregate revenues for the industry accelerated in 2021. The increasingly virtual business practices put in place during the pandemic are boosting usage even as dislocations to the labor force add to the pool of independent contractors available for consultations. As a result, industry revenues increased 21% to $1.92 billion, the highest annual growth rate since 2013.
A key performance indicator for the industry is job postings, which have soared during 2021. The study includes weekly recruiting data for the largest 15 expert networks, which provides insight into the industry’s recovery since the height of the pandemic. Open positions fell 67% from March 2020 to the end of June 2020, before rebounding to March’s levels in November 2020. After a pause in December, hiring levels continued to grow, then accelerated dramatically in the spring of 2021. Job openings as of November 2021 were 132% higher than as of March 2020, having increased from about 400 open positions to almost 1,000.
The study, which used company filings, interviews with current and former employees and external metrics to estimate company-level revenues, includes analysis of regional revenue splits for the top expert networks, finding that the US remains the largest geographic source of industry revenues. Asia represents a major growth opportunity. “We’re seeing strong growth from Asia-based expert networks,” said study co-author Max Friberg of Inex One. “Europe also has additional potential. If Europe and APAC get to the US consumption levels, the market would exceed $3 billion.”
The 2021 Expert Network Market Sizing study includes information on key client segments, as expert network revenues have expanded beyond their hedge fund origins. Most of the recent growth is coming from customers other than the buy-side and banks. “Corporates are the fastest growing client segment, with both private equity and consulting consumption posting 20%+ growth,” said Friberg. “Consulting firms are especially important customers for expert networks since they can pass on their expenses to their end clients.”
The 2021 Expert Network Market Sizing study includes Excel worksheets detailing revenues for the top 42 expert networks from 2012 through 2021. Also included are analyses of regional revenues, market share development, productivity benchmarks and customer segment information. Underlying metrics used to support revenue estimates are also included. For further details go to https://expert-network-market-data.sellfy.store/
Our Take
The acceleration in expert network industry revenues during 2021 partly reflects the altered work environment, where virtual interactions are now the new normal. Expert consultations by phone or video are a natural extension of current work practices.
The industry is also benefiting from an expanding range of services beyond the core product of expert consultations. Surveys are an important source of revenues, as exemplified by industry leader GLG’s aggressive hiring of survey staff.
Transcripts of previously-conducted expert consultations are also proving a popular new offering. Third Bridge has been investing heavily in generating transcripts at a rate of 7,000 per year covering 6,000 public and private companies. Recent entrant Tegus has built a library of over 20,000 transcripts since its founding in 2017. Start-up transcript provider Stream by Mosaic was recently acquired by AlphaSense.
New entrants such as Prosapient, Techspert.io and NewtonX have emphasized new technologies, seeking to improve expert sourcing through natural language processing and machine learning. Leading expert networks such as AlphaSights are investing in new technologies to not only improve the timeliness and quality of the experts sourced, but also to improve staff productivity and profit margins.
Vibrant industry growth is also reflected in recent M&A activity. Japan-based VisasQ, which went public in 2020, acquired Coleman Research, which is three times its size. Leading China expert network Capvision has filed for an IPO in Hong Kong while the largest expert network in the industry, Gerson Lehrman Group, is preparing an IPO in the US.
The 2021 Expert Network Market Sizing study reinforces the view that expert network industry prospects remain auspicious.