Gerson Lehrman Group
Encyclopedia
Gerson Lehrman Group founded in 1998 and headquartered in New York City
, operates an expert network
platform of more than 300,000 subject matter experts who provide independent consulting
services to companies around the world.
GLG primarily serves the investment community improving their decision-making process by putting clients in touch with relevant experts through a variety of consulting methods, including telephone conversations, surveys, written reports and in-person events and meetings. GLG clients also include professional services
firms, corporations, and non-profit organization
s.
GLG Members include consultants, physicians, scientists, engineers, lawyers, market researchers but also senior-level business executives - including former and current corporate C-level/presidents - and also former senior members of governments.
The company divides its experts by field of expertise, focusing on specific industries or disciplines. GLG practice areas include: Accounting and Financial Analysis; Consumer Goods and Services; Energy
and Industrials
; Financial and Business Services; Healthcare; Legal, Economic and Regulatory Affairs; Real Estate
; and Technology
, Media
and Telecom
.
has ever heard of", was founded by Duke University and Yale Law School graduate Thomas Lehrman and fellow Yale Law School graduate Mark Gerson, who had worked at Tiger Management
, one of the world's largest hedge funds, that led to a generation of spinoffs, known as Tiger Cubs . GLG , initially funded by a friends and family round , was formed as a publishing house to produce industry guidebook
s for institutional investors, a business they abandoned a year later when they could find no buyers for their product. The two retooled their business model a year later to offer a matchmaking service (later called expert network
) to connect investors with independent consultants. Its services filled a research gap by providing timely, proprietary insights that were increasingly difficult to get from large brokerage firms.
. Clients can also identify appropriate experts from the network and manage the logistics around the consulting session via a Web-based software tool called the Research Management Platform (RMP). GLG connects clients with relevant experts in a variety of consulting methods, such as:
The company’s approach of connecting people and allowing for ranking of the experience involves a number of elements associated with social networking sites. There are some who consider the GLG model to be part of the evolving social network collaboration trend.
Experts are usually invited by GLG researchers to join the network based on their expertise or association with industry organization
s. Experts can also submit their profiles online, including biographical descriptions and other background information and choose their own honorariums. GLG home page states that it has more than 250,000 experts in its network. A competitor, Vista Research, is said to have a network of 90,000.
According to GLG website the company serves asset managers, private equity, investment banks, and venture capital clients as well as consultancies, corporations, law firms, life sciences companies, marketing agencies, nonprofit and public sectors. Some of its best clients include 15 of the leading 20 global investment banks, 9 of the world's leading 10 private equity
firms and Fortune 500
clients in virtually all sectors. The Economist
recently reported that GLG’s clients spend on average $170,000 a year and that GLG keeps a record of "who talks to whom, about what, down to the minute". .
Gerson Lehrman Group claims it facilitates more than 18,000 transactions a month on average. A typical phone consultation with an expert lasts for approximately 45/60 minutes.
In 2008, according to a report by Integrity Research there were at least 25 expert network providers and GLG had about 70% of the market. Estimates of the company’s value range from $875 million to $950 million. A 12-month revenue figure of $220 million was included in a company press release in December 2007 that announced that technology investment firm Silver Lake had made an approximately $200 million investment in GLG. An article published in Financial News in January 2009 reported that the company's revenues for 2008 were $284 million.
Experts without the written consent from their employers may also only participate in a limited number of consultations and online surveys.
GLG has recently won an award for its compliance framework
On September 10, 2008, the company announced a deal with Credit Suisse
, whereby analysts from the financial services giant would be able to tap into GLG’s Council Members as part of their research process. About 300 Credit Suisse analysts became members of the GLG expert network.
On July 8, 2010, GLG and Bloomberg
announced a partnership that enables clients of the Bloomberg Professional platform to access the GLG expert network through the Bloomberg platform. Through the partnership, Bloomberg clients can view the bios of more than 50,000 GLG Members on the Bloomberg terminal, request consultations with experts, and access news commentary, video, webcasts and teleconferences .
, the company operates globally in key cities around the world.
In January 2009, the company opened an office in Dublin, Ireland. In September 2009, Gerson Lehrman Group's acquisition of French expert network TGR Research provided the company with an office in Paris, France.. It was also reported that firms business in Asia grew 90 percent in 2008.
in March 2006, in which Biovail claimed that its shares had been manipulated. In September 2006, GLG announced the creation of a proprietary system that helped identify and manage conflicts, leveraging its experience as a pioneer in its industry to craft risk-reducing rules for expert engagements
In January 2007, it was reported that the company and Vista Research, then a Standard & Poor affiliate, were part of an inquiry by the New York State Attorney General’s office into the consulting practices of investment firm clients. As of December 2007, the Attorney General had taken no action, and the investigation appeared to be dormant.
Althought GLG has not be implicated of any wrongdoing the overall Experts Network industry has caught the eye of the regulators and is since the end of 2010 going through investigations by the American Regulators, after a consultant testified having used Primary Research Global, another expert network, to leak information to traders .
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
, operates an expert network
Expert network
The expert network phrase was originally coined by Mark O'Connor of the Yankee Group in presentations introducing his August 1997 Management Strategies report, Knowledge Management: People and the Process, using the Teltech Resource Network as a commercial example of related services.The first...
platform of more than 300,000 subject matter experts who provide independent consulting
Consultant
A consultant is a professional who provides professional or expert advice in a particular area such as management, accountancy, the environment, entertainment, technology, law , human resources, marketing, emergency management, food production, medicine, finance, life management, economics, public...
services to companies around the world.
GLG primarily serves the investment community improving their decision-making process by putting clients in touch with relevant experts through a variety of consulting methods, including telephone conversations, surveys, written reports and in-person events and meetings. GLG clients also include professional services
Professional services
Professional services is an industry of infrequent, technical, or unique functions performed by independent contractors or by consultants whose occupation is the rendering of such services....
firms, corporations, and non-profit organization
Non-profit organization
Nonprofit organization is neither a legal nor technical definition but generally refers to an organization that uses surplus revenues to achieve its goals, rather than distributing them as profit or dividends...
s.
GLG Members include consultants, physicians, scientists, engineers, lawyers, market researchers but also senior-level business executives - including former and current corporate C-level/presidents - and also former senior members of governments.
The company divides its experts by field of expertise, focusing on specific industries or disciplines. GLG practice areas include: Accounting and Financial Analysis; Consumer Goods and Services; Energy
Energy
In physics, energy is an indirectly observed quantity. It is often understood as the ability a physical system has to do work on other physical systems...
and Industrials
Industry
Industry refers to the production of an economic good or service within an economy.-Industrial sectors:There are four key industrial economic sectors: the primary sector, largely raw material extraction industries such as mining and farming; the secondary sector, involving refining, construction,...
; Financial and Business Services; Healthcare; Legal, Economic and Regulatory Affairs; Real Estate
Real estate
In general use, esp. North American, 'real estate' is taken to mean "Property consisting of land and the buildings on it, along with its natural resources such as crops, minerals, or water; immovable property of this nature; an interest vested in this; an item of real property; buildings or...
; and Technology
Technology
Technology is the making, usage, and knowledge of tools, machines, techniques, crafts, systems or methods of organization in order to solve a problem or perform a specific function. It can also refer to the collection of such tools, machinery, and procedures. The word technology comes ;...
, Media
Mass media
Mass media refers collectively to all media technologies which are intended to reach a large audience via mass communication. Broadcast media transmit their information electronically and comprise of television, film and radio, movies, CDs, DVDs and some other gadgets like cameras or video consoles...
and Telecom
Telecommunication
Telecommunication is the transmission of information over significant distances to communicate. In earlier times, telecommunications involved the use of visual signals, such as beacons, smoke signals, semaphore telegraphs, signal flags, and optical heliographs, or audio messages via coded...
.
Origins
Gerson Lehrman Group, once called the "most valuable NYC company no one outside of Wall StreetWall Street
Wall Street refers to the financial district of New York City, named after and centered on the eight-block-long street running from Broadway to South Street on the East River in Lower Manhattan. Over time, the term has become a metonym for the financial markets of the United States as a whole, or...
has ever heard of", was founded by Duke University and Yale Law School graduate Thomas Lehrman and fellow Yale Law School graduate Mark Gerson, who had worked at Tiger Management
Tiger Management
Tiger Management Corp., also known as "The Tiger Fund," was a hedge fund founded by Julian Robertson. The fund began investing in 1980 and was closed in March 2000.-History:...
, one of the world's largest hedge funds, that led to a generation of spinoffs, known as Tiger Cubs . GLG , initially funded by a friends and family round , was formed as a publishing house to produce industry guidebook
GUIdebook
GUIdebook is a website that contains screenshots of computer software.It shows a visual history of the software's user interface. It includes operating systems like Mac OS and Windows, desktop environments like GNOME and KDE, portable operating systems like Newton OS and Windows CE, and...
s for institutional investors, a business they abandoned a year later when they could find no buyers for their product. The two retooled their business model a year later to offer a matchmaking service (later called expert network
Expert network
The expert network phrase was originally coined by Mark O'Connor of the Yankee Group in presentations introducing his August 1997 Management Strategies report, Knowledge Management: People and the Process, using the Teltech Resource Network as a commercial example of related services.The first...
) to connect investors with independent consultants. Its services filled a research gap by providing timely, proprietary insights that were increasingly difficult to get from large brokerage firms.
Business model
GLG operates a technology-enabled platform for institutions to consult and collaborate with experts in various industries and disciplines around the globe. Clients work with Research Managers who, with the help of a proprietary set of online profiling and compliance tools, identify, find, vet and connect relevant experts with usersUser (computing)
A user is an agent, either a human agent or software agent, who uses a computer or network service. A user often has a user account and is identified by a username , screen name , nickname , or handle, which is derived from the identical Citizen's Band radio term.Users are...
. Clients can also identify appropriate experts from the network and manage the logistics around the consulting session via a Web-based software tool called the Research Management Platform (RMP). GLG connects clients with relevant experts in a variety of consulting methods, such as:
- telephone consultations
- educational events
- written reports
- live meetings, including seminars, round tables, master classes and private visits
- research trips and summits
The company’s approach of connecting people and allowing for ranking of the experience involves a number of elements associated with social networking sites. There are some who consider the GLG model to be part of the evolving social network collaboration trend.
Experts are usually invited by GLG researchers to join the network based on their expertise or association with industry organization
Organization
An organization is a social group which distributes tasks for a collective goal. The word itself is derived from the Greek word organon, itself derived from the better-known word ergon - as we know `organ` - and it means a compartment for a particular job.There are a variety of legal types of...
s. Experts can also submit their profiles online, including biographical descriptions and other background information and choose their own honorariums. GLG home page states that it has more than 250,000 experts in its network. A competitor, Vista Research, is said to have a network of 90,000.
According to GLG website the company serves asset managers, private equity, investment banks, and venture capital clients as well as consultancies, corporations, law firms, life sciences companies, marketing agencies, nonprofit and public sectors. Some of its best clients include 15 of the leading 20 global investment banks, 9 of the world's leading 10 private equity
Private equity
Private equity, in finance, is an asset class consisting of equity securities in operating companies that are not publicly traded on a stock exchange....
firms and Fortune 500
Fortune 500
The Fortune 500 is an annual list compiled and published by Fortune magazine that ranks the top 500 U.S. closely held and public corporations as ranked by their gross revenue after adjustments made by Fortune to exclude the impact of excise taxes companies collect. The list includes publicly and...
clients in virtually all sectors. The Economist
The Economist
The Economist is an English-language weekly news and international affairs publication owned by The Economist Newspaper Ltd. and edited in offices in the City of Westminster, London, England. Continuous publication began under founder James Wilson in September 1843...
recently reported that GLG’s clients spend on average $170,000 a year and that GLG keeps a record of "who talks to whom, about what, down to the minute". .
Gerson Lehrman Group claims it facilitates more than 18,000 transactions a month on average. A typical phone consultation with an expert lasts for approximately 45/60 minutes.
In 2008, according to a report by Integrity Research there were at least 25 expert network providers and GLG had about 70% of the market. Estimates of the company’s value range from $875 million to $950 million. A 12-month revenue figure of $220 million was included in a company press release in December 2007 that announced that technology investment firm Silver Lake had made an approximately $200 million investment in GLG. An article published in Financial News in January 2009 reported that the company's revenues for 2008 were $284 million.
Compliance Framework
Before joining GLG platform and become able to participate in consultations, all experts are required to complete an interactive tutorial and agree to its Terms and Conditions contract. According to their website , among other things, all Council Members need to sign the contract in where they agree to:- Decline any project that presents a conflict of interest
- Not discuss confidential information
- Not discuss or to speak on behalf of their employer
- Consult only in accordance with other obligations
Experts without the written consent from their employers may also only participate in a limited number of consultations and online surveys.
GLG has recently won an award for its compliance framework
Partnerships
As the use of alternative research providers within the financial industry has grown, brokerages themselves have been partnering with firms such as GLG.On September 10, 2008, the company announced a deal with Credit Suisse
Credit Suisse
The Credit Suisse Group AG is a Swiss multinational financial services company headquartered in Zurich, with more than 250 branches in Switzerland and operations in more than 50 countries.-History:...
, whereby analysts from the financial services giant would be able to tap into GLG’s Council Members as part of their research process. About 300 Credit Suisse analysts became members of the GLG expert network.
On July 8, 2010, GLG and Bloomberg
Bloomberg L.P.
Bloomberg L.P. is an American privately held financial software, media, and data company. Bloomberg makes up one third of the $16 billion global financial data market with estimated revenue of $6.9 billion. Bloomberg L.P...
announced a partnership that enables clients of the Bloomberg Professional platform to access the GLG expert network through the Bloomberg platform. Through the partnership, Bloomberg clients can view the bios of more than 50,000 GLG Members on the Bloomberg terminal, request consultations with experts, and access news commentary, video, webcasts and teleconferences .
Offices
In addition to Gerson Lehrman Group's headquarters in New York CityNew York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
, the company operates globally in key cities around the world.
- Austin, TX, USA
- BostonBostonBoston is the capital of and largest city in Massachusetts, and is one of the oldest cities in the United States. The largest city in New England, Boston is regarded as the unofficial "Capital of New England" for its economic and cultural impact on the entire New England region. The city proper had...
, USA - ChicagoChicagoChicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
, USA - Los AngelesLos ÁngelesLos Ángeles is the capital of the province of Biobío, in the commune of the same name, in Region VIII , in the center-south of Chile. It is located between the Laja and Biobío rivers. The population is 123,445 inhabitants...
, USA - San Francisco, USA
- Washington, D.C.Washington, D.C.Washington, D.C., formally the District of Columbia and commonly referred to as Washington, "the District", or simply D.C., is the capital of the United States. On July 16, 1790, the United States Congress approved the creation of a permanent national capital as permitted by the U.S. Constitution....
, USA - LondonLondonLondon is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
, UK - Hong KongHong KongHong Kong is one of two Special Administrative Regions of the People's Republic of China , the other being Macau. A city-state situated on China's south coast and enclosed by the Pearl River Delta and South China Sea, it is renowned for its expansive skyline and deep natural harbour...
- New DelhiNew DelhiNew Delhi is the capital city of India. It serves as the centre of the Government of India and the Government of the National Capital Territory of Delhi. New Delhi is situated within the metropolis of Delhi. It is one of the nine districts of Delhi Union Territory. The total area of the city is...
, IndiaIndiaIndia , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world... - BeijingBeijingBeijing , also known as Peking , is the capital of the People's Republic of China and one of the most populous cities in the world, with a population of 19,612,368 as of 2010. The city is the country's political, cultural, and educational center, and home to the headquarters for most of China's...
, ChinaChinaChinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture... - ShanghaiShanghaiShanghai is the largest city by population in China and the largest city proper in the world. It is one of the four province-level municipalities in the People's Republic of China, with a total population of over 23 million as of 2010...
, ChinaChinaChinese civilization may refer to:* China for more general discussion of the country.* Chinese culture* Greater China, the transnational community of ethnic Chinese.* History of China* Sinosphere, the area historically affected by Chinese culture... - SingaporeSingaporeSingapore , officially the Republic of Singapore, is a Southeast Asian city-state off the southern tip of the Malay Peninsula, north of the equator. An island country made up of 63 islands, it is separated from Malaysia by the Straits of Johor to its north and from Indonesia's Riau Islands by the...
- SydneySydneySydney is the most populous city in Australia and the state capital of New South Wales. Sydney is located on Australia's south-east coast of the Tasman Sea. As of June 2010, the greater metropolitan area had an approximate population of 4.6 million people...
, AustraliaAustraliaAustralia , officially the Commonwealth of Australia, is a country in the Southern Hemisphere comprising the mainland of the Australian continent, the island of Tasmania, and numerous smaller islands in the Indian and Pacific Oceans. It is the world's sixth-largest country by total area... - TokyoTokyo, ; officially , is one of the 47 prefectures of Japan. Tokyo is the capital of Japan, the center of the Greater Tokyo Area, and the largest metropolitan area of Japan. It is the seat of the Japanese government and the Imperial Palace, and the home of the Japanese Imperial Family...
, JapanJapanJapan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south... - ZurichZürichZurich is the largest city in Switzerland and the capital of the canton of Zurich. It is located in central Switzerland at the northwestern tip of Lake Zurich...
, SwitzerlandSwitzerlandSwitzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition.... - Dublin, IrelandIrelandIreland is an island to the northwest of continental Europe. It is the third-largest island in Europe and the twentieth-largest island on Earth...
- ParisParisParis is the capital and largest city in France, situated on the river Seine, in northern France, at the heart of the Île-de-France region...
, FranceFranceThe French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France... - Sao PauloSão PauloSão Paulo is the largest city in Brazil, the largest city in the southern hemisphere and South America, and the world's seventh largest city by population. The metropolis is anchor to the São Paulo metropolitan area, ranked as the second-most populous metropolitan area in the Americas and among...
, BrazilBrazilBrazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...
In January 2009, the company opened an office in Dublin, Ireland. In September 2009, Gerson Lehrman Group's acquisition of French expert network TGR Research provided the company with an office in Paris, France.. It was also reported that firms business in Asia grew 90 percent in 2008.
Controversy
The expert network business model has drawn scrutiny for concerns relating to adherence to disclosure rules and sharing of insider information within the investment industry. During 2005, for example, doctors who served as paid consultants to investment firms as a result of their role in an expert network generated a “fair share of controversy.” GLG was part of a lawsuit filed by BiovailBiovail
Biovail Corporation was a Canadian pharmaceutical company, operating internationally in all aspects of pharmaceutical products. Its major production facility was located in Steinbach, Manitoba...
in March 2006, in which Biovail claimed that its shares had been manipulated. In September 2006, GLG announced the creation of a proprietary system that helped identify and manage conflicts, leveraging its experience as a pioneer in its industry to craft risk-reducing rules for expert engagements
In January 2007, it was reported that the company and Vista Research, then a Standard & Poor affiliate, were part of an inquiry by the New York State Attorney General’s office into the consulting practices of investment firm clients. As of December 2007, the Attorney General had taken no action, and the investigation appeared to be dormant.
Althought GLG has not be implicated of any wrongdoing the overall Experts Network industry has caught the eye of the regulators and is since the end of 2010 going through investigations by the American Regulators, after a consultant testified having used Primary Research Global, another expert network, to leak information to traders .
External links
Further reading
- "Linking expert mouths with eager ears", The Economist, June 16, 2011..
- "Hedge Funds Keep Watch on Washington" by David Bogoslaw, BusinessWeek, September 22, 2009
- "Hedge Funds Look to Policy Experts to Decode Washington" New York Times DealBook, September 23, 2009
- "Information Have and Have Nots" by L. Gordon Crovitz, The Wall Street Journal, September 22, 2008
- "Network of 200,000 experts provides IP evaluations" by Steve Lewis, Intellectual Property Marketing Advisor, November 4, 2008
- "Midnight Thoughts on Gerson and Credit Suisse" Integrity Research Associates, September 11, 2008
- "Credit Suisse analysts gain access to expert network" by Anette Jonsson, Finance Asia, September 16, 2008
- "Want Our Stock Researchers? Pay Up!" by Aaron Lucchetti, The Wall Street Journal, September 10, 2008
- "Investment Research: Continued Shift" robwebb2k, September 10, 2008
- "Investment Research + Massive Shift" robwebb2k, September 10, 2008
- "Integrity Publishes Comprehensive Report on Expert Networks" Integrity Research Associates, March 2, 2008