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Finding needles in The Haystack using Wealth Tracker

Finding needles in The Haystack using Wealth Tracker. Hugh Bennett, MIT, 10/11/2012. What we'll cover. Focus will be on: The Daily WT Email Alerts Major Gift prospecting Finding "new" prospects or "significant" events What to look for in the alerts How to take next steps w/ research

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Finding needles in The Haystack using Wealth Tracker

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  1. Finding needles in The Haystack using Wealth Tracker Hugh Bennett, MIT, 10/11/2012

  2. What we'll cover • Focus will be on: • The Daily WT Email Alerts • Major Gift prospecting • Finding "new" prospects or "significant" events • What to look for in the alerts • How to take next steps w/ research • How to look for clues to go beyond alerts

  3. Background of Presenter • Hugh Bennett • 25 years in financial services, including research. • Experienced with M&A, IPO's, and VC financings. • Corporate and non-profit board experience. • Fund raising experience at secondary schools. • 6 years at MIT in higher ed research. • Leads effort that has doubled # of confirmed MIT prospects.

  4. Definition – "NEW Prospect" • New prospects are individuals who are not currently rated for major gift capacity. • These prospects may not currently be in the existing database at all, but should all have some "connection" to be "real". • These prospects probably don't have some combination of current address, title, career, and/or wealth info in their records. (Note how this would be hard to "data mine".)

  5. WealthTracker emails • Emails are broken into several useful distinct segments: • A) "People in Motion" or "New Execs Added" • B) Stock Transactions • C) M&A, VC, IPO or Other Financings • D) Political Giving • E) Wealth Monitor Alerts (like "C" above)

  6. WT Emails • Source data in emails is typically from either: • A) from matched names in a job announcement, M&A sale announcement, stock transaction, etc. • B) web "crawled" found instances of your organization or school on a web site or announcement. • Sending your database of names to WT will improve your match rate. • False positives do occur (ex: "mit" in German)

  7. Data Entry • Emails present Data - and Data Entry questions. • Decide what to track and enter - all or only selected positions. • Decide whether to internally centralize daily screening of WT emails for consistent methodology and familiarization. • Decide what is so important that it should become part of a standard "Alerting" process to your GO's and hierarchy.

  8. CORE MG Focus Ideas • NEW DATA ("People in Motion" or new): • A) Look for new job/career data (but verify, verify). • A2) Consider what is primary job – maybe 2 jobs. • B) Look for new connection types (ex: post-docs). • C) Focus on top C level execs only.

  9. CORE MG Focus Ideas • STOCK TRANSACTIONS: • A) Focus on $ sales over a predefined level. ($1M) • B) Net out any option exercises to get to net sale $ • C) Aggregate stock sales in any one email and periodically check frequent or programmatic sellers in database to see how much their multiple sales have accumulated to. • D) Unlike others above: also note any new names or large new issuances of options or stock.

  10. CORE MG Focus Ideas • TRANSACTIONS: • A) Focus on Sellers only in M&A ($$) • A2) Focus on M&A sales over $10M. • A3) Try to drill down to what proceeds your individual will receive. Don't focus only on a headline number like $1B. • B) Focus on larger venture financings (over $10M). • C) Screen all IPO's in SEC files.

  11. CORE MG Focus Ideas • POLITICAL GIVING: • A) formulas vary, but these gifts are believed to be a very good indicator of MG capacity. • B) Direct gifts are currently limited in size, but some other gifts to PACs, etc can be very large. • C) Screening these lists for gifts of over $1,000 or $2,000 is highly likely to correlate with MG capacity.

  12. EXTEND your search • WealthMonitor or Sale alerts may not pre-identify connected individuals. • Still consider extending search with larger transactions. • Check company seller website for management and board bios. • Check your database for largest individual sellers to see if present. Remember: some people do not self identify and list all their background.

  13. Wealth Monitor EXAMPLE (#1) • Today's WealthMonitor Alerts • Number of Results 21     Results per page • 100 • All •  Date • 2012-10-05 Blu Homes expects to be IPO-ready within 18 months, CEO says   Wealthmonitor • 2012-10-05 Li & Fung in advanced talks to acquire Synergies Worldwide - report (Oriental Daily) • 2012-10-04 McClatchy could divest online assets to facilitate near term refi efforts   Wealthmonitor • 2012-10-04 Global Leisure - Q3 Deal Round-up   Wealthmonitor • 2012-10-04 PhoneFactor acquired by Microsoft (Company Press Release(S)) • 2012-10-04 Cisco acquires vCider (Company Website) • 2012-10-04 Nekoosa Coated Products acquired by Wingate Partners (Company Press Release(S))

  14. EXAMPLE (#1) • Wealth Monitor Intelligence Event Profile • EventPhoneFactor acquired by Microsoft • 2012-10-04 Company Press Release(S) • Microsoft Corp. and PhoneFactor Inc. today announced that Microsoft has acquired PhoneFactor, a recognized leader in multifactor authentication (MFA) solutions. • "The acquisition of PhoneFactor will help Microsoft bring effective and easy-to-use multifactor authentication to our cloud services and on-premises applications," said Bharat Shah, corporate vice president, Server and Tools Division for Microsoft. "In addition, PhoneFactor's solutions will help Microsoft customers, partners and developers enhance the security of almost any authentication scenario." • Founded in 2001, PhoneFactor is trusted by hundreds of leading organizations to help secure millions of logins and transactions each year. By leveraging a device nearly every user already has — a phone — PhoneFactor enables rapid deployment of MFA across a wide range of applications. It already works with many Microsoft products and services, including Outlook Web Access and Internet Information Services, and interoperates with Active Directory. • "We are thrilled to join Microsoft and look forward to bringing our secure, cost- effective and convenient authentication solutions to the millions of Microsoft customers, partners and developers around the world," said ------- ------, CEO and co-founder of PhoneFactor. • Terms of the deal were not disclosed.

  15. Example (#1) • In this WealthMonitor example, matches were noted at Microsoft. No connected individuals or matches were noted at PhoneFactor. • But, after going to their website, it was noted and confirmed that the Co-Founder and CEO of PhoneFactor is an MIT alumnus. • Our database did not have his current employment and business title. He was unrated and had no contact history. • He was estimated to be receiving significant proceeds in the transaction.

  16. Example (#2) • Today's Stock Transactions • Date Title Ticker Buy/Sell Estimated # of • Proceeds Shares • $Amount Owned • 10/4 Vice VC Disposed 404,370 52,398 President

  17. EXAMPLE (#2) • This individual's sale proceeds are below $1M which would have led to us normally skipping over. • Because the screening of WT was centralized, it was noted that this was a name that had not been noticed before. The shares owned column also looked significant. • Clicking into his WT profile confirmed him as an alum. Our database info was old + he was unrated. • SEC proxy check confirmed current stock holdings were at MG rating level. Sales were additional.

  18. Example (#3) • Recipient Party Amount • OBAMA FOR AMERICA Democratic $1,990 Move-on Political Action Unspecified 200

  19. Example (#3) • This donor was confirmed to be an MIT alumnus. • He was unrated with a generic title at his employer. • His company had been very successful and he was a lead product developer (though not top 5 exec). • We did not know he was married or her name; or that she was also making similar donations. • Combined they had made over $10K in political donations in past five years. • Further research noted substantial owned real estate and confirmed MG capacity.

  20. CONCLUSIONS • WT is webcrawling and matching relevant individuals AND transactions. • The percentage of false identity matches seems relatively low. • We can do confirmations AND do further research on any significant transactions. (ex: big M&A sales) • Sometimes WT provides the lead that is itself an indicator that prompts further research that can confirm MG capacity. (ex: political giving) • Research from these leads is warranted as it turns up "Needles in the haystack".

  21. Questions • Questions ?? • Contact data: • Hugh Bennett Ted Hafner • email: hbennett@ mit.edu thafner@hepdata.com • Phone: 617-258-5545 703-623-5028

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