With 176% revenue growth in the last 3 years and $4.2M in revenue in 2017, PreScouter landed the 2446th rank on the 2018 Inc.5000 list. For the company’s 50 employees and CEO founder Dino Gane-Palmer, making it to Inc Magazine’s ranking of the fastest-growing companies reflects how far the company has come. It also illustrates how effective the company has been in its mission – using siloed academic innovation to help business leaders make better R&D, product development, and corporate development decisions.
What makes PreScouter different from the rest of the global ~$21B Business Intelligence market is its network of researchers and subject matter experts. 2 out of the company’s 4 founders were Ph.D.s who helped recruit highly specialized academic researchers and subject matter experts. These researchers were largely cash-strapped Ph.D. scholars, whose academic careers had given them some years of subject expertise but limited exposure to professional work in the commercial world.
In time, the network expanded to a wide range of subject matter experts from various industries. They represented a cost-effective way to find and adopt new technologies or derive market insights, as compared to staffing an in-house team of full-time employees.
Leveraging this differentiator, PreScouter has built a network of 2500+ Scholars who are advanced degree researchers and subject matter experts. The company has used their services to deliver 2500+ projects to 600+ clients, including GE Healthcare, Coca Cola, BAE Systems, Clorox, and Volvo.
PreScouter’s service – cost-effective access to new business intelligence
PreScouter’s owes its genesis to the fallout from the Chinese milk scandal of 2008. Companies that made animal feed in China were adding toxic melamine scrap to their products. The dairy was feeding this to milching livestock, which were thus providing toxic milk. When this contaminated milk was converted into powder for babies, it poisoned 300,000 infants.
The WHO made a global appeal for a fast and cheap test, and found the University of Minnesota had been sitting on such a test for several years. For Gane-Palmer, this event was foundational in his journey of founding PreScouter.
“I was in Northwestern University at the time, trying to find an idea around which to start my own company. The scandal was making international news, and I heard about that the cure had been hiding away in academia during this whole time. Bioo Scientific acquired the test from the University of Minnesota and was able to distribute it commercially to help resolve the crisis. The delay and its human cost was still cause for concern, and inspired me to find a way to break down these walls between academic research and the market.”
With this mission, Gane-Palmer now needed the two things every business needs – resources to offer a service, and customers willing to buy it.
The first steps in building PreScouter – a Chicago growth story
During his summer internship, Gane-Palmer dug through the Northwestern alumni directory and reached out to R&D directors of Chicago’s big private businesses. The R&D director of a medical device manufacturer told Gane-Palmer that he would rather use PreScouter than keep an internal team to find innovations for commercialization.
With this validation, he decided to build a startup which would offer big companies a valuable untapped commercial resource – researchers and subject matter experts with several years’ experience. He reached out to the three people who would start PreScouter in 2010 with him and used a research stipend to start the company.
Pre-Scouter’s Co-Founders – Ashish Basuray, Doug Pollina, and Alok Tayi – were fellow Northwestern students. Basuray and Tayi were Ph.D. candidates in Chemistry and Materials Science respectively. Pollina and Gane-Palmer, as the MBA students, were expected to handle the company’s finance, operations, and marketing.
When Gane-Palmer went back to the medical device manufacturer, the R&D director was no longer as interested in the concept. They found some early work from Kraft Foods, DSM, and Honeywell instead.
Building a network of researchers and experts
Basuray and Tayi managed the first few projects before they started recruiting others and building a network of researchers and experts to complete work for existing clients. New leads, sourced through the alumni network or cold calls to R&D directors, needed answers to questions which lay outside the expertise of their existing network of experts. To keep up and not lose potential business, they needed to expand their network substantially.
In response, Basuray and Tayi used their network to spread the word that PreScouter could help research scholars get professional experience while earning money on the side. As Gane-Palmer said, “We were and are able to use the draw of commercial experience and money to find science and engineering Masters and Ph.D. degree holders. Our customers were happy to use their expertise instead of relying on the expensive time and effort of their own teams.” To continue tapping into the more and more specialized demands of clients, over time PreScouter added to its talent network individuals from industry. These industry experts often pursue working with PreScouter as a way to build industry contacts, as well as challenge themselves to new, interesting problems.
Today, PreScouter has started conducting research projects in packaging, natural resources, materials, consumer goods, food and beverage, transportation, finance, and healthcare. The company manages a comprehensive digital network of postgraduate degree holders, academic researchers, and subject matter experts from across the world. Available projects are shared on a regular basis, and members of the network apply for those that fit their profile.
Scaling up – finding clients
Beyond delivering a talent network to deliver the service, building the sales pipeline was the other big growth challenge. Fellow Northwestern alumnus and prominent VC Matt McCall introduced Gane-Palmer to Zach Kaplan, another Chicago-based founder and CEO of Inventables. Kaplan was able to condense learning from over a decade of experience in the field to provide pointers for selling to R&D labs.
These pointers led Gane-Palmer to classmates at business school who helped train the early PreScouter team on the sales skills needed to build a sales funnel. PreScouter’s growth stands testament to the sales team’s growth and ability to evolve and leverage the company’s network of researchers and experts to serve its expanding portfolio of clients.
PreScouter was also aided in its growth by the uniqueness of its model. It has no competitors in the conventional sense. Small, specialized R&D advisory firms often provide inquiry-driven research in specific domains like pharmaceuticals or materials science, but nothing with PreScouter’s breadth of service or access to cross-domain expertise.
PreScouter today, business intelligence, and PreScouter tomorrow
Today, Pollina is the CFO and Basuray is the Chief Scientist. Tayi has gone on to start his own company, TetraScience. The full-time scientists act as both advisors to clients, as well as project managers. They select scholars and experts who apply for projects from across their network and search out specific talent to fill existing gaps. They build multidisciplinary teams that are able to bring the latest innovations to bear in answering questions for companies looking to evolve their products or services.
Gane-Palmer asserts that this is substantially more cost-effective than maintaining expensive R&D teams for large companies, especially when their research questions are very specific. Corporate research teams need to go through long recruitment processes to add domain expertise, but PreScouter just needs to find the right expert. “Working with PreScouter is more cost-effective and provides better access to specific expertise – this is PreScouter’s USP”, according to Gane-Palmer.
When it comes to its larger mission, has PreScouter removed the information asymmetry that it was founded to resolve? Public visibility of the company’s work is low, as the innovation they foster is largely attributed to their client companies. Gane-Palmer wants to change that and wants to leverage its success story to make a bigger splash in the business intelligence game.
PreScouter is now publishing studies on subjects ranging from smart packaging solutions to neural brain-machine interfaces. These and other content – insights into the state of academic research into concussion detection, energy storage, drug discovery, and scientific fixes for the deleterious effects of pesticide use – is giving the public and the market more reason to engage with wider range of outside innovation, from sources ranging from startups and academic research, to innovations developed in adjacent industries and even by competitors.
PreScouter may help a Food&Beverage player find a natural replacement for sugar in beverages, or help big automobile manufacturers use carbon dioxide as eco-friendly refrigerants in electric vehicles. The broad principle – of removing information asymmetry to find the best answers to the problems facing humanity today – is hard to argue against.