Selecting a Family Office Database
When choosing a family office database for your capital raising needs, there are many things to consider, including the company your database will come from, the sort of service they provide, what sort of refund they offer, etc. These are all important factors to weigh when choosing the right database for your needs.
Here are 5 tips to finding the best database for you and your company:
1. Do your homework. This means doing two types of research: researching your needs and what the company selling the database can offer to you. What are others saying about the database online? What does their website look like? Are they open with who they are and what they offer? Do they offer other products? Really get a feel for the main players offering databases and evaluate their products against each other.
More importantly, use this step to really define your needs, what the “perfect” database includes, and what you are capable of, including your budget.
2. Know your budget. Before you can (or should) go shopping, you must know what you can spend. Also, be sure to plan for future database purchases or updates to the data you initially receive. More importantly, see what the company offers in terms of updates or discounts to future versions. This can be an area where you can save money in the long run, which is more important than doing so in the short run. Most quality databases will cost more than $800 but less than $2,000.
Just remember that your budget can transcend into future quarters if you have to replace the database you purchase due to quality or need to update it in the future. What sort of budget do you have to set to take those realities into account?
The budget is more of an internal issue, somewhat apart from the companies you evaluate, but know that it can limit or hinder your ability to find useful data. Knowing you budget leads to the next point:
3. Look at all the factors, not just price. Putting price as the deciding factor above everything else is a mistake that could be costly and take a great amount of time when searching for a replacement database. A company may offer a relatively low (or high) price, but that is not the only point of comparison that you need to evaluate. Look at the quality of data, the service they offer in addition to the database, and the potential for ROI (return on investment). Consider what needs you have that must be met, which database works best for you, and the one that offers the best price once you’ve considered the other factors.
Those other factors can include:
a. How the database is accessed. Is the database only available online? That can be a problem when you need 2-3 professionals accessing the database at a time. Moreover, what happens if the company goes under or takes the database down? You’ve lost your investment.
b. Frequency of updates made to the database. How often is the data being looked at, updated, and added to?
c. What is their definition of a family office? If they don’t list this, ask them to ensure you know what you’re buying.
d. What is their definition of a contact? Is their number reflective of offices or simply contacts? Did they include the secretary in their database from a large, well-known family office?
e. Do they include just family offices, or do they include private equity firms?
f. Do they include contacts with incomplete listings? Know the percentage here.
4. Try to avoid buying more than you need. Some databases offer thousands of contacts. The quickly changing data within a family office database may be useless before you can get to the remaining prospects. Know what your capabilities are and what you can realistically utilize from a database. How many leads do you need? Consider that the data may change every 6-12 months; how quickly can you get through the data you purchase?
5. Know the benefits of purchasing a database from a particular company. For example, some companies may not offer a refund, whereas other companies may offer a refund of the purchase price, or even a 2 times or greater refund. Keep in mind that this data changes so frequently, so remember to find a company that will recognize and cater to your need for up-to-date information. Remember, too, that even the best databases will have a 2%-3% error margin for their data. Find companies that can help you work with these errors and hedge the risk of making a large purchase for a product that loses its value quickly because the information is no longer good. Also, keep in mind the backing of the company; does any sort of association or group back them? Are they transparent in who they are and their knowledge, or do they offer a generic email address with no personalization? If their level of service to you is so poor with you not even being a customer yet, imagine what their level of service will be once you are a customer.
Overall, remember to be smart and to make an educated decision. There are many things to consider, and keeping the above in mind can help you to make a better decision in the long run. Ask questions, do your research, and compare companies to see who offers a better product, can meet your requirements, and does so within your budget.
Download our free e-book on family offices here: http://FamilyOfficeReport.com
Review our Family Office Database resource here: http://familyoffices.com/Family-Office-Database.html
Tags: Family Office Database, Family Offices Database, Database of Family Offices, Single Family Offices Database, Single Family Office Database, Multi Family Office Database, database of multi family offices