The Rise of DIY Lobbyists: Disrupting a $3 Billion Market with Analytics and Tools
Outsell for Startups podcast Q&A: Alex Wirth of Quorum Analytics
When it comes to legislation, companies need to know what’s coming before it’s too late to communicate to law makers how it could impact their business. However, hiring lobbyists to monitor and lobby government is generally the preserve of well-funded corporations and organized industries. With major changes to the current global political landscape increasing the need for insight and analysis about legislation, government contracts, and regulation, companies are looking for a solution, which is why the government affairs market is attracting a lot of investment.
I interviewed Alex Wirth, one of the co-founders and CEO of Quorum Analytics, an integrated public affairs platform. They’ve supported companies that include Walmart, GM, Lyft, and over 1,000 public affairs professionals across the Fortune 500, trade associations, nonprofits, advocacy firms, so on and so forth.
Quorum is seizing on the current trend to improve and automate some of the tasks carried out by white-collar workers with data analytics. Outsell is witnessing this across industry sectors, from lawyers to scientific researchers. Quorum has the potential to enable ordinary company executives to carry out professional DIY lobbying by providing the data, information, and workflows tools they need at their fingertips. This could potentially help to democratize the lobbying industry, which has acquired a negative public image.
In the US alone, those lobbying the government in 2016 spent $3.15 billion, presenting Quorum with a large addressable market to grow its business. Quorum’s opening of an office in Brussels is also a timely move. New EU laws and recent regulatory actions from the European Commission are making many US tech companies realize that the regulatory framework in Brussels can damage their global business. For example, the GDPR is likely to influence privacy regulations and practices around the world, not just within the EU.
Quorum has bootstrapped its business and funded growth from subscription revenue. This has allowed the company to test the market and avoid over spending on unnecessary things. It is now in a better position to know exactly where it needs to invest, and it has a stronger negotiating hand to raise funds to achieve its ambition of becoming the Bloomberg terminal for government affairs within five years.
Key Metrics
Founded: 2014
Number of Employees: 44
Podcast Q&A
(Listen on Apple Podcasts, Stitcher, or SoundCloud.)
First and foremost, Alex, why politics? You could have gone in any direction so why this one?
Alex: This is actually really interesting because this is a question that we ask most folks who apply to work at Quorum. So, what’s the interest in government and politics? And I think the answer for me is multifaceted in that I grew up in a family that was pretty political. So, my dad was elected to the state House of Representatives when I was a fifth grader in elementary school, and he would always come home and not participate in his campaign and walk doors, but also would come home and share conversations at the dinner table about what happened in the state office and then eventually the state Senate. He’s now been the legislature for the last 13 years, so I have very much grown up around it.
That’s what initially drew me, and I think sparked my interest in it and really around the high level of the ability to represent others. When you look at government, whether it’s a student council all the way to the state legislature and the federal government, it is the best way to have change on the largest level, and that if you want to fundamentally change how things are happening, politics are the place to be and the way to do it.
In Harvard, you started Quorum. Where did that idea come from? What was the problem that you looked at and went, “I think we can build a solution for this?”
Alex: I was up on Capitol Hill doing advocacy work, and in particular we were trying to get a council of young Americans to be able to advise the president. The campaign we would call at the time the Campaign for Presidential Youth Council, and ran head on into the challenge of how do you keep track of all the information on Capitol Hill and in particular how do you sort through it to find actual insights.
We had congressman John Larson, who was our lead co-sponsor of the bill, and we wanted to know who he worked with most frequently. My roommate at Harvard and I figured out that if you take the same code that’s used to do analytics around networks, you can actually apply that to Congress and figure out who every member of Congress works with most frequently. That for us was the spark that led us down this path of realizing that if we pulled in massive amounts of data and then applied it in an analytical way, we actually could produce insights that would be really actionable and would help our clients and people in Washington and really anybody across the country understand what’s going on in the political process and help them understand issues that they care about.
Today, what is the 30 second pitch of what Quorum does?
Alex: We help people have an impact on the issues that they care about by maximizing their advocacy efforts and helping them measure the success so that they know how well those advocacy efforts are doing. We do this across our six platforms, monitoring for the US government level, federal, state, and local, in addition to the European Union, and then have a stakeholder engagement in grassroots advocacy platform that helps organizations manage their ambassadors and external contacts.
If I understand the model correctly, at a high level, Quorum is collecting all of this data around political activity via social media, anything across the web, and creating all these data points and then selling that data via a subscription where if you’re a company like Airbnb or Lyft, you can go in and get real time updates on legislative movements that are related to your company. Am I understanding that correctly?
Alex: That’s great! You should come and work for us! It’s a really good description of what we’re doing. A key component also is we’re doing a lot of outreach tools, so we have a grassroots advocacy widget that helps connect people with their members of Congress. For example, when you get an email from a given association, say the National Restaurant Association, it says, “Hi, dear restaurant owner! We want you to take action,” it might be our widget that’s powering that. You put in your name, your address, and we say, “This is your member of Congress,” and then help you connect with that member of Congress and actually patch that through to Capitol Hill. So that for us is really where we’re taking in not just organizations, but also individuals and helping them to connect with their member of Congress.
How would you say Quorum’s different compared to say Bloomberg or any of your competitors that are providing a similar solution?
Alex: Three big things. The first off is that we have more information that we release, so we’re the world’s most comprehensive database, analyzing information pulled from a larger variety of sources. The second is that we’re quantitative, so we’ve actually put the analytics layer on top of it. So, it’s not just here’s the stack of information, go fetch. It’s, here’s the information, here are the insights that are most helpful. The last piece of it is that we’re easy to use, so all the technology is built within in the last two years, and we’ve really made an effort to make the platform friendly and modern, which isn’t something that many of our other competitors’ platforms have.
It seems like any company could benefit from this platform, but who’s your target customer? Who’s the person in the company that you’re reaching out to?
Alex: We are looking for anybody whose day to day job and full-time job is advocacy, and so that could be at the federal, state, or local level. But we find that you really have to be primarily focused on it to be a good candidate for the platform. Certainly, there are exceptions, but that’s who we target to.
In terms of a higher level, when working with a fortune 500, we’re looking for a vice president of public affairs. So, a head of office is who we sell to because the entire team can be on the same platform. So across federal, state, local, grassroots, European Union, and stakeholder engagement work … they can go to one platform to be able to access all of it.
What would you say is the greatest challenge that Quorum currently faces?
That’s an interesting question. I think the one that I’m spending a lot of time thinking about now is how do we put in place and strengthen middle management. So, it’s been just an absolutely wild growth curve for us in that in 2016 we doubled in size, and then in 2017 we’ve doubled in size again. So now at 44 people, we’ve hit kind of that magic mark of 30 when the company’s smaller and everybody knows who’s in the loop. We’ve always had an amazing leadership team, but now we’re to the point where the leadership team has people below them who are also managing members on our team. So, we’re spending a lot of time thinking about how do you structure that best and how do you really set up an environment that’s supposed to continue to scale and grow. And just for us, putting in that structure means there’s a lot of new communication challenges and ensuring that everybody’s got a pathway all the way up … what’s where, what it’s about, what’s happening across the company. Also, as well that we’re putting in place really good individual management roles in the newly created roles, not just having exceptional people on the leadership team. At the same time, we’re thinking a lot about how can we free up those on our leadership team, so instead of having 11 draft reports, they have six and that will be really essential for us as we continue to grow, so it’s something we’re spending a lot of time thinking about now.
Your competitor FiscalNote raised $30 million in funding recently. Does that make it hard to compete with them?
Alex: So actually, we haven’t found it challenging, and I think it’s really a fascinating business study. So, as you probably know, we’re 100% bootstrapped, and all of our growth is funded by subscription revenue from our clients. So really, it’s two completely different models, and I think what FiscalNote has tried to do is grow too quickly and hasn’t figured out their product market fit. We don’t find ourselves losing to them, and we don’t find ourselves in the federal market at all competing with them. Until recently, they didn’t have a grassroots advocacy product, and then they’re not in the stakeholder engagement, local, or Europe space.
So really, there’s a lot of places that they’re not in, and I think if you look at them, there’s a lot of opportunities for improvement overall.
We operate in a global economy now, and a very connected world with a lot of legislative and regulatory items coming out around the world. Quorum very much focuses on US legislation. Is Quorum missing part of the picture? What is your sense of how Quorum deals with global issues?
This is the big opportunity, and we actually made a huge announcement in February that we are opening up an office and operation in the European Union. So, we have built the first ever platform to be able to track what’s happening with the European Council and Parliament. We currently have somebody on the ground in Brussels working on bringing Quorum’s presence abroad, and I think that’s incredibly exciting.
We started with the European Union because that is the second largest focus for public affairs and professionals after Washington DC. We wanted to bring a really solid contribution to market and help folks in the European Union track what’s going on, and we’ve been the first people there doing that. I think for us the question will always continue to be where are the opportunities to justify the cost that it takes to build a platform, and particularly what I’m interested in, are there ways that we can provide that level of global monitoring through partnerships and deploying original pieces of data that we can really be helpful overall in continuing to build that out.
Does a president that displays erratic behavior make it harder to predict what legislation will be pushed through, especially with increases in the use of executive orders? Do you have to constantly just monitor the president’s Twitter feed?
We actually don’t predict legislation, and this is a big difference between us and the FiscalNote approach. The problem with it is, and the problem with trying to even use president Donald Trump’s Twitter feed to do it, is that if I predict that zero bills pass in the US Congress, I get 97% accuracy, because that’s just the null hypothesis. Three percent of bills pass. So, there’s not enough variation to actually get a statistical outlook that would be correct enough times to have it be useful for people.
So, we’re lucky in that we don’t predict the passage of bills. I think the interesting Trump factor that we end up seeing is that he’s encouraging more legislators to be more active and use social media. Senator Dianne Feinstein just announced and tweeted for the first time for her reelection campaign on social media. People are seeing Twitter and Facebook as a tool to communicate with their constituents, and so with that, I think the president is actually setting an example, and it helps our business because more people are looking towards social media to put in place a policy platform to be able to make major statements on the platform.
Along with more people looking towards social media, do you see any other trends that are happening in this environment?
So, I mean, when you look at politics in general, I think what’s interesting is that we actually see Congress, especially the House of Representatives, as being extraordinarily productive. So, the House really jumped at the start of the race at the beginning of this legislative session in 2017 and not only introduced, but passed out a large amount of legislation to the point where, as compared to previous Congresses, they were ahead of where they were.
The Senate for a long time is the one that is much, much slower. They have definitely picked up their overall legislative productivity, and so there’s a chance this year that Congress could actually be able to move a number of bills, even if they aren’t necessarily the major legislative accomplishments that the media picks up on.
What has been your greatest accomplishment so far with this company? Or the company’s greatest accomplishment?
One, we work with a number of really small startups and nonprofits and to see their legislative successes through the use of the platform is awesome. They’ve actually been able to directly change the outcome of policy and be much more active than they would have been previously, and so that’s really fantastic. The second big thing is the work that we’ve done around open government data and informing more Americans about what’s happening with the political process, and all the media we’ve got is not necessarily about the company, but it’s also about our data and our insights and being able to share those with different people to let people know is just awesome.
And then I think also in that vein of access to data, we were loosely involved with some of the efforts around how do we get CR reports open and accessible to the public and getting more of that as an example of what happens when you put congressional data available online. That’s been really awesome to see, a legacy that will last long, just beyond Quorum, for the really long and foreseeable future.
Where do you see Quorum in one year?
The key thing that we’re focused on over the course of the next year is the launch of our stakeholder engagement of the local and European Union products, so we’re bringing products to market that we’ve launched in the last year. It’s incredibly exciting to be able to share those with the individuals, and that will be our really big focus and just work on federal, state, and grassroots tools.
Where do you see Quorum five years from now?
We want to be the default platform that when anybody comes to Washington to have an impact on an issue, they call us up and say, “We need to use Quorum. We need Quorum’s tools and resources.” That’s really our goal over the course of the next five years, and I think we look a lot towards the Bloomberg terminals down in New York … it is the same way that to work on Wall Street, you have to have a Bloomberg terminal. We want to be the same thing in DC, where if you want to work in DC, you have to have access to Quorum.
Thank you for reading this CEO Q&A interview with Alex Wirth. This write-up is only a portion of the full interview. To hear the full interview, please listen to our podcast “Outsell for Startups”. It can be found on Apple Podcasts, Stitcher and Sound Cloud. You can also find more information on Outsell for Startups at our website. Thanks for reading!
