Suppose you are a startup founder, and your business has run into a problem that cannot be solved with in-house capabilities. Or you are trying to enter into a new market but not sure how you should proceed, where do you look for help? The answer is startup consulting.
A startup consulting firm can help young startups in a number of ways. It includes anything from marketing and product development to building their core business strategy and compliance.
They provide startups with actionable insights and proprietary resources to achieve their targets. Startup consulting firms can have a significant impact on the overall journey of a startup.
Before we talk about the best startup consulting firms today, let’s first discuss in brief about consulting firms and what they do exactly.
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What Is A Consulting Firm?
A consulting firm is simply a business entity that provides expert advice, guidance, and related services (specialized labor) to other organizations for a fee. Those who carry out these operations are called consultants.
When businesses run into problems or issues that they cannot handle with their in-house capabilities, consulting firms are then hired to solve them. In other words, a consulting firm helps other businesses to solve issues.
Consulting firms offer their services in almost every industry, from finance, healthcare, and technology to engineering, manufacturing, and the public sector.
What Do Consulting Firms Offer Startups?
Startups are different from larger and more established businesses in a number of ways. They have less workforce, stricter budget constraints, and, more importantly, time constraints.
These are some of the challenges every startup founder has to face, at least in the early stages, to achieve the company’s long-term goals. This is where a consultancy firm comes in.
Startups can leverage the expertise of outside consultants to get actionable insights and access invaluable industry knowledge in less time.
Below are the few advantages consultancy firms can offer to a startup.
Cost Efficiency: Hiring outside consultants can be more cost-effective than full-time employees for specific projects.
It allows startups to work with more experienced advisors who have in-depth knowledge of their industry without the long-term commitment and associated costs of a full-time staff.
Time: Hiring a business consultant also helps startup founders in better time management. It can relieve their extra workload and free up time for other issues that are important.
Strategic Planning: In most cases, startups don’t follow formal processes, such as having a clear business plan, which can be seen as time-consuming and an obstacle to creativity.
However, it ultimately leads them to various inefficiencies and poor allocation of resources. Startups can also become directionless.
A capable consulting firm or consultant can help startups find their best strategy for the long, medium, and short term.
Networking: Experienced consultants may have connections in the industry, which can help your business get into new markets and make M&A deals and collaborations.
Below are 11 of the best startup consulting firms.
11. Latham & Watkins
Industry: Tech, manufacturing, biotechnology, and life sciences
Services: Legal, growth equity, merger and acquisitions
Latham & Watkins is one of the largest and most profitable law firms in the world. Since its foundation in 1934, Latham is known for its expertise in corporate and regulatory matters.
It specializes in practices such as corporate law, M&A, finance and banking, securities litigation, and bankruptcy. The firm has operations in almost all key venture capital hubs around the world, including San Francisco, Boston, London, Hong Kong, and Austin.
Latham has a dedicated practice area that caters to the legal needs of startups of every size. They offer tailored and cost-effective legal advice to startups at every stage.
Latham’s strong presence in M&A, capital markets, and corporate finance makes it an ideal partner for a liquidity event.
In 2022, Latham & Watkins was named Start-Up Firm/Emerging Company Law Firm of the Year by Law.com.
The firm has been involved in several high-profile corporate cases, including Anheuser-Busch InBev’s acquisition of SAB Miller in 2016 and Rivian Automotive’s $12 billion IPO, the largest public offering in 2021.
More recently, Latham Watkins represented semiconductor manufacturer Wolfspeed in one of the largest private capital funding of up to $4 billion.
It also served as the legal advisor to Capri Holdings, owner of fashion brands such as Versace and Jimmy Choo, during its $8.5 billion acquisition by Tapestry, Inc.
Why Do Startups Need Legal Consulting?
For an entrepreneur, keeping up with regulatory changes and carrying out tons of legal requirements can be a daunting issue. But it is also crucial for the survival of any startup.
If your legal requirements are restricted to incorporating your new venture, then you can simply use publicly available information to get the job done.
However, as your startup grows, you’ll have to deal with more complex legal issues that require professional guidance. These issues include anything from drawing up contracts, and term sheet negotiations to licensing, IP strategy, and fundraising.
Thus, it is critical for your startup to hire a law firm that not only practices startup law but is also experienced in your industry.
10. Cooley Go
.@PitchBook has recognized Cooley in its Q3 2023 rankings as the #1 law firm in the US and globally for representing companies in #venturecapital financing deals and first overall for representing late-stage companies.
— Cooley LLP (@CooleyLLP) November 21, 2023
Industry: Tech, life sciences, real estate, media, education
Services: Fundraising, intellectual property, IPOs, incorporation
Cooley is another multinational law firm that offers a wide range of legal services to growth startups and emerging companies.
The firm’s key practice areas include corporate, litigation, regulatory, and intellectual property laws. It specializes in legal areas related to startups, such as fund formation (private equity), debt financing, venture capital, and emerging companies law.
Based in Palo Alto, Cooley is one of the most elite law firms in Silicon Valley. It represents about 29 percent of all unicorn companies based in the U.S. and is one of the top firms globally for representing companies in tech IPOs and VC funding.
Out of all the industries that Cooley provides services in, its expertise in the life sciences and technology industry is far more renowned and top-notch.
Cooley’s decades of experience in big-name tech IPOs and connections in private equity financing make it a go-to law firm for startups and emerging companies.
Cooley has created a portal called Cooley Go that allows startup founders to get easy access to step-by-step guidance, analysis, and other basic startup-related legal information for free.
The platform can also be used to generate legal documents for your startup business, such as term sheets, financing documents, consulting agreements, and incorporation packages.
9. L.E.K. Consulting
The transition to #battery #electric vehicles has been a challenge to navigate. Explore the hurdles and range of perspectives that highlight the need for a clear, agile commercial strategy. https://t.co/2KeheYztcQ #electricvehicles #LEKAutomotive pic.twitter.com/GVeamNajCC
— L.E.K. Consulting (@LEK_Consulting) December 9, 2023
Industry: Retail, education, finance, tech, health care, private equity, transportation, B2B
Services: Marketing, product consulting, facilities management, legal ops, talent management, pricing
L.E.K Consulting is a Boston-based global consulting firm established by three former Bain & Company consultants – James Lawrence, Iain Evans, and Richard Koch.
The firm offers its services to a wide range of industries including, financial services, healthcare, technology, retail, energy, and media. It specializes in areas such as marketing and sales, operations management, corporate strategy, and mergers.
L.E.K also has considerable private equity consulting capabilities with which it helps private equity clients through the entire transaction cycle from identifying potential companies for buyout to making strategic exits from those companies.
The firm’s expertise in private equity markets allows it to provide strategic advice on a variety of business issues to startups as well.
L.E.K Consulting offers bespoke services to startups based on their growth stage and industry. Some of its core startup services include – business planning, fundraising, product and service innovation, and mergers and acquisitions. It relies on its advanced research capabilities, modeling, and analysis to provide support to clients.
8. Bain & Company Next
Industry: Tech, retail, health care, private equity, energy, automotive, education, financial services
Services: Digital marketing, customer experience, advanced analytics, software engineering
Bain & Company is a Boston-based management consulting firm that provides advice and other consulting services to corporations and government organizations.
It is one of the ‘Big Three’ management consultancies, or MBB, alongside McKinsey & Company and Boston Consulting Group (BCG).
The concept of MBB is similar to that of the Big Four Banks or the Big Four accounting firms. The MBB is considered the largest and most prestigious management consulting firm in the world.
Bain specializes in areas such as mergers & acquisitions, finance, market analysis, operations, and corporate strategy. It is also one of the leading firms in private equity consulting in the world.
In 2018, about 25 percent of Bain’s global revenue came from private equity consulting.
Bain is traditionally known to serve large corporates, most of which are Fortune 500 companies. However, the firm has recently established a technology-focused unit that caters specifically to emerging companies and startups for business building. This unit is branded as Bain Next.
Bain Next has a total workforce of more than two hundred consultants and industry experts who offer advice to startup founders in areas such as digital marketing, design, software engineering, and analytics.
It also provides support with product building, scaling, and adoption of new technologies to help startups realize growth.
More About Bain & Company
The firm was founded in 1973 by Bill Bain (William Worthington Bain Jr.). Before establishing his own firm, Bill Bain worked as a consultant and later became the vice president at Boston Consulting Group.
In 1984, several partners from the firm spun off its private investment arm into Bain Capital, which was headed by Mitt Romney.
7. BCG X
Image Courtesy: BCG X
Industry: Auto, fintech, manufacturing, retail, and tourism
Services: AI-powered Customer management, marketing, supply chain, program management, analytics
Boston Consulting Group, or BCG, is one of the most recognized names in the consulting industry. It is currently one of the three largest management consulting firms by revenue.
BCG was founded in 1963 by Bruce Henderson, who is considered one of the pioneers of the consulting industry.
Among the important business analysis concepts developed by BCG and Bruce Henderson include the Growth Share Matrix, also known as BCG Matrix. It helps companies allocate resources to their different business units.
Today, the firm conducts its operations through two main units – BCG and BCG X. While BCG is responsible for traditional management consulting operations, BCG X carries more technology-focused consulting services for the firm.
BCG X allows its clients in core industries such as automotive, financials, retail, and industrial manufacturing to innovate and overcome technology roadblocks.
It leverages the firm’s deep industry expertise and advanced technology to help clients, both large corporates and startups, with digital transformation and growth, operational capabilities, AI, and advanced analytics.
Services: Web development, UX/UI, managed IT services, cybersecurity
ScienceSoft is a global IT services provider and consulting firm that offers a wide range of services to both large corporate clients and startups.
Founded in 1989, ScienceSoft has more than three decades of experience in the tech industry and is consistently ranked one of the fastest-growing companies in the United States.
Some of the core services provided by the firm include software/web development and testing, digital transformation, analytics, managed IT services, and IT consulting. It has also built technology expertise in several key domains including, CRM, ERP, operations management, fintech, intranets, and web portals.
The company is highly versatile in terms of the total number of services it offers.
What’s more important is that ScienceSoft also offers its product development and consulting services to startups. It helps modern startups with end-to-end product development, from creating a proof of concept and UX/UI design to testing, integration, and deployment.
Viber app, an instant messaging and VoIP platform founded in 2010, is an example where ScienceSoft built a mobile application for a popular startup.
The app currently has more than 1 billion downloads on Google Play and is one of the most popular social networking apps on App Store.
Industry: Crypto, fintech, eCommerce
Services: Digital marketing, SEO, web design, blockchain, video/email marketing
NinjaPromo is a New York-based digital marketing firm that excels in building brand equity for its clients.
With its multi-channel marketing solutions, NinjaPromo helps digital startups improve their brand recognition and reach their target audiences much faster. It is a one-stop shop for all your digital marketing needs.
Some of the core services offered by NinjaPromo include social media engagement (including advertising), email and influencer marketing, SEO, lead generation, video production, and other creative marketing. It also engages in mobile app/web design and development.
NinjaPromo specializes in providing services to fast-paced tech startups such as blockchain or Web3 technology, though it also serves clients and fintech and e-commerce industries. Some of its popular clients include Bitcoin.com, Credible Labs, and Paypolitan.
Founded in 2017, NinjaPromo has raised $400k in seed capital.
Gartner Hype Cycle research methodology that shows growth cycle of new technologies | Image Courtesy: Gartner
Industry: Tech, energy, financial services and manufacturing
Services: R&D, marketing, cybersecurity, legal, data and analytics capabilities
Gartner is a tech-focused research and consulting firm based in Connecticut, U.S.
It was founded in 1979 by Gideon Gartner, a renowned Wall Street investor and analyst who mostly focused on the tech industry in the 1970s. He is also widely considered as the pioneer of the analyst industry.
Gartner provides actionable insights and advice to clients on different aspects of IT businesses, including digital transformation, adoption of new technologies, infrastructure & operations, and cybersecurity.
Gartner’s deep knowledge of the tech industry and more than four decades of consulting experience make it a go-to consulting firm for tech companies worldwide. It also caters to finance, healthcare, and retail industries.
The firm helps growth-stage and mature startups improve their products and services, build supply chains, identify new market opportunities, and mitigate risks.
Gartner is well-known for its influential market research and analysis reports. Perhaps the most important market research report published by Gartner is called ‘Magic Quadrant.’
It exhibits trends and market positioning of participants in key areas of the tech industry using their proprietary qualitative data analysis tools.
Gartner is part of the S&P 500 index.
Industry: Healthcare, apparel, logistics, consumer B2B
Services: Story development, content creation, media engagement
LaunchSquad is a tech-focused marketing consulting firm that offers creative services (PR) to startups, growth companies, and government agencies.
Founded in 2000, LaunchSquad has been in the marketing industry for more than two decades and has built a reputation as an effective storyteller for startups. Today, it serves clients of different sizes, mostly from the tech, healthcare, and apparel industries.
LaunchSquad excels in building a strong brand image and market positioning for its clients through smart content creation and media engagement.
The firm works closely with its clients to develop content marketing strategies that are in line with their future plans.
Some of the popular startups that have worked with LaunchSquad for their creative services in the past include American Giant (a clothing brand), Gradle (software), Atom Power (EV), Waabi, and Zipline (logistics).
Apart from emerging startups, LaunchSquad also serves government agencies. Recently, in October 2023, the firm was hired by the city of San Francisco to promote the 30th Asia-Pacific Economic Cooperation (APEC) Leaders’ Summit that was going to take place next month.
Industry: E-commerce, tech, SaaS
Services: Growth hacking, UX, SEO, marketing, social media, compliance, branding
Marketing is critical to the growth and long-term success of any business. It not only allows you to connect with prospective clients and sell more but also helps build a brand identity.
However, carrying out an effective marketing campaign is exhausting and increasingly difficult, especially for a startup.
As a business owner, if your in-house marketing efforts are turning out to be ineffective, you might want to hire an outside marketing specialist or consultant.
GrowthRocks is a U.K.-based marketing consulting firm that focuses on growth hacking to achieve customer’s marketing goals.
Growth hacking is an experiment-based marketing subfield that relies on extensive A/B testing, search engine optimization, website analytics, and other viral strategies to capture the attention of potential customers.
GrowthRocks is one of the most popular growth hacking agencies in the world, with operations in over 26 countries. The firm has a team of designers, consultants, web developers, and marketers that work in cohesion to execute growth strategy and build a user base for their clients.
Some of the growth services provided by the firm include SEO copywriting, link building, UX, PPC marketing, GDPR compliance, and brand strategy testing.
For startups, GrowthRocks also offers on-demand consulting services on an hourly basis. It provides advice on user acquisition and retention, referral programs, eCommerce optimization, and email marketing.
1. McKinsey & Company Fuel
Founded in 1926, McKinsey & Company has been at the forefront of the management consulting landscape for nearly a century. It is the largest management consulting firm by revenue.
It offers management consulting services to clients in areas such as mergers and acquisitions, business operations, strategy, and risk compliance in all major industries.
While the firm is well known for serving large, traditional companies such as AT&T and General Motors, it also provides services to new businesses.
To better engage with clients in this digital age, McKinsey has developed a robust portfolio of embedded management and analytics tools known as ‘McKinsey Solutions’ that leverage technology to provide key insights to businesses much more quickly.
It helps companies and organizations identify new opportunities and help them make better and faster decisions.
McKinsey also has a dedicated advisory and consulting platform for startups known as ‘McKinsey Fuel.’ It allows startups (early stage and growth stage) to build capabilities and scale faster with the help of the firm’s deep industry knowledge and reach.
The platform focuses on areas such as price optimization, sales and marketing, and growth strategy.
Note: If you’re a new SaaS startup, I suggest you check out McKinsey’s SaaSRadar, a benchmark database of pre-IPO SaaS startups that will help you better understand this sector.
More About McKinsey & Company
McKinsey is the oldest and the largest (by revenue) of the ‘Big Three’ management consultancies, which include Boston Consulting Group and Bain & Company.
Unlike most other global consulting firms, McKinsey doesn’t have a traditional headquarters. It is a decentralized organization where most regional offices are managed independently, and senior partners have more autonomy.
McKinsey has built a reputation of being a go-to firm for many large corporations in the U.S. for advice and even executive-level hiring. Former McKinsey consultants have been hired by companies like Internet Brands (owner of WebMD), Citigroup, Morgan Stanley, and Google Cloud for their top management roles.
McKinsey is known to charge about 25 to 30 percent more for its services than its competitors. It shows the sheer dominance of McKinsey & Company in the consulting industry.
More To Know
How To Choose The Right Consulting Firm For Your Business?
As a business owner, you can hire a consultant or a consulting firm to address any issue that may arise within the company. But, how do you know which consulting firm is the right fit for your business?
Although finding the right consulting firm for any business ultimately depends on factors such as budget, time frame, and goals, there are a few critical elements that can help you determine whether a consulting firm can help you achieve the desired results or not.
A successful track record is what separates a good consultant from the best. Before hiring one, you should always discuss their previous projects and experiences with issues similar to yours.
Make sure you ask for their past client references, which can validate their track record and help you better understand how they work.
Since outside consultants are often hired by companies that cannot afford to build in-house capabilities, it is only logical to work with a firm or agency that provides a reasonable cost structure.
A clear budget outline and cost structure are critical factors to consider while deciding on which consulting firm you should work with.
However, finding an affordable consulting firm doesn’t mean in any way that you should work with a cheaper one. The key is to find a balance between the quality of services provided and the cost.
Remember that you should always go for an experienced services provider (a consultant in this case), who can achieve your goals much faster at relatively higher billing rates than an inexperienced one who takes much longer to reach the goals at cheaper rates.
How Much Does a Consultant Make?
The average annual salary of a consultant in the United States is around $88k. Like in most other industries, the salary of consultants can vary based on certain factors, including qualification, skills (specialization), experience, and even location.
For instance, an entry-level consultant in the U.S. can make about $43k in a year, but an experienced associate consultant can expect to earn about $90k per year. The average salary for a senior consultant is $117k.
Consulting salaries in the big three consulting firms tend to be higher than the industry average.
How Big is the Global Consulting Industry?
In 2022, the global management consulting industry was valued at just over $307 billion and is expected to reach $511 billion by 2028 and grow at a CAGR (compound annual growth rate) of 9% during the period of 2023 and 2028.
The management consulting industry is largely dominated by a handful of large, global firms that offer services to clients across all major industries. These companies can be put into two groups.
The first group includes the four major accounting firms –
- PricewaterhouseCoopers International (PwC)
- KPMG, and
- Ernest & Young
The second group includes the big three management consultancies, also known as MBB –
- McKinsey & Company
- Boston Consulting Group, and
- Bain & Company
In 2018, these seven firms held about 48 percent market share in the industry
Outside of these firms, IT services giants, including Accenture, IBM, and Capgemini, have significant consulting businesses.
Then, there are several prominent regional players and boutique management consulting firms that offer more localized services to their customers or clients.
Some examples of boutique consulting firms include Cornerstone Research (specializing in litigation and economic consulting), the Keystone Group (offering services exclusively to the manufacturing industry), and Putnam Associates (life sciences).