The $83B market research industry faces a fundamental problem that has persisted for decades: traditional methods force companies to choose between depth and scale. Focus groups provide rich qualitative insights from a handful of participants, while surveys deliver quantitative data that lacks the nuanced understanding of consumer motivations. Despite technological advances across every other business function, market research has remained stuck using the same tactics from the 1950s and 1960s, leading to unreliable data and misguided strategic decisions. Hootology addresses this longstanding challenge with HOOQZ, a GenAI-powered platform that hosts dynamic discussions in simulated environments, enabling companies to gain qualitative insights at quantitative scale. Through human-first, AI-supported virtual conversations, the platform delivers the rich, nuanced understanding that traditional surveys cannot provide while maintaining the statistical significance that focus groups lack. Founded in 2016 and serving over half of all Fortune 100 companies, Hootology has built a proven track record before launching this next-generation research tool.
AlleyWatch sat down with Hootology CEO and Founder Stefanie Francis to learn more about the business, its future plans, recent funding round, much, much more…
Who were your investors and how much did you raise?
We have raised $1.1M in pre-seed funding, led by JAD Family Revocable Trust.
Tell us about the product or service that Hootology offers.
Hootology is a market research agency that was founded in 2016, differentiating itself among other options on the market by marrying psychological insight with technological innovation. With the launch of HOOQZ, we’re proving that market research doesn’t have to be either deep (qualitative) or broad (quantitative)—it can be both. HOOQZ enables companies to uncover rich, nuanced insights at scale through engaging and dynamic human-first, AI-supported virtual conversations that feel natural and immersive—a far cry from the static, dry surveys the industry has historically relied on.
What inspired the start of Hootology?
The team at Hootology is made up of—to be perfectly frank—open-minded nerds. I used to teach a graduate-level market research course at NYU, but I resigned because I was just so frustrated by the lack of evolution in market research, and I hated the idea of telling students that the best/only tactics were the same ones being used since the 1950s and ‘60s. With HOOQZ, we’re addressing the opportunities in market research by leveraging modern tech advancements (including AI) to address a fundamental shortcoming in traditional market research: the inability to glean rich, nuanced insights at scale.
How is Hootology different?
What sets Hootology apart is the ability to understand the “why” behind the irrational human mind, at scale, to provide more meaningful and reliable information for large-scale strategic decision making.
What market does Hootology target and how big is it?
The market research sector is estimated at around $83B.
What’s your business model?
Right now, Hootology is a full-service research provider. We work with large agencies and brands to collect information about how their customers think and feel in a way that informs their decisions including marketing and advertising strategy. We’re working toward having a licensable SaaS, B2B offering in the future.
How are you preparing for a potential economic slowdown?
Obviously economic downturns are stressful for everyone, but Hootology can be helpful for others during that. The times when brands are forced to tighten their belts and think hard about where they’re spending their money are the moments when we can have the biggest impact in terms of helping those brands survive or even flourish. During economic downturns, brands’ need to get things right is that much more acute, and the cost of getting things wrong is that much more weighty. The data our research generates both reduces spend by dissuading strategies that will fall flat and prove to have been a waste of time and money, and it increases ROI by creating the conditions for truly lucrative, successful strategies.
What was the funding process like?
Hoo boy. The funding process is the stuff of therapists’ dreams. Multiple times at different events people would tell me “It takes 200 conversations to get one ‘maybe.’” That sure is inefficient for a sector that exists to create more efficient ways of doing things. Additionally, the funding process rewards extroverts and those with enough time to have hundreds of conversations—meaning, they’re not working on their product or leading their team. I have found that the best founders are the ones who start their companies because they love what they do, are GREAT at it, and are tired of the B.S. of typical “leaders”. Our funders are genuinely excited about what Hootology does and what HOOQZ can be; they understand the problem we’re solving. They’re strategic partners who I feel really understand us. So in the end, I feel really fortunate.
What are the biggest challenges that you faced while raising capital?
I have a TED talk started in my mind about this. Happy to share over a dirty Kettle One martini with blue cheese olives with anyone who cares as passionately as I do about improving the fundraising dance—I believe it can be better for everyone—including the funders.
What factors about your business led your investors to write the check?
Our investors are extremely successful business owners, and no one understands the stagnated state of market research more than business owners. There wasn’t a need for me to convince them that traditional surveys are starting to be outdated and the data they provide can be very flawed—they already knew that. They believe in the need to radically modernize market research.
What are the milestones you plan to achieve in the next six months?
We’re halfway through our fourth round of development, which is going to incorporate automatic reporting. That’s automatic reporting of the quantification of qualitative data, meaning what is now a four to five-month process will take under a week. We’re also excited to release our revamped graphics, which we are working to get as close to high-end video game graphics as possible. These will be rolling out in the next few months.
We’re halfway through our fourth round of development, which is going to incorporate automatic reporting. That’s automatic reporting of the quantification of qualitative data, meaning what is now a four to five-month process will take under a week. We’re also excited to release our revamped graphics, which we are working to get as close to high-end video game graphics as possible. These will be rolling out in the next few months.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
The first thing that comes to mind is “I feel you.” It’s not easy. It’s helped me to think of it the way I think about flying. I’m a nervous flyer, despite all of the miles I have logged for work. So whenever we hit turbulence and I feel myself starting to fret, I tell myself “OK, you thought we were gonna crash a minute ago, and we didn’t. You thought we were gonna crash 30 seconds ago, but we didn’t. Each time you’ve thought we were going to crash you’ve been wrong. Odds are, we’re not going to crash today.” As founders, there are countless times when we think “That’s it, it’s over, I’ve failed.” And we’re wrong. My advice would be to think of all the times you thought you were going to fail and you didn’t. This is likely one of those times, so keep going.
Where do you see the company going now over the near term?
I would have expected my answer to be solely “we’re going to work on growing our user base,” which, of course, is still our goal. But we’ve also seen interest from large global agencies as they rework their strategies for unique and rapidly changing times. Ultimately, our goal has always been to be brought into the right large agency. Right now, the focus is on continuing to develop HOOQZ (we have four more development rounds planned with some super modern capabilities). The goal will then be to build the next thing that we can’t even imagine today because times will continue to change (both from societal and technological standpoints). I have been surprised by the interest not just from research agencies, but from ad/marketing and large business strategy agencies as well. It’s a tough question to answer right now, so I will go with “grow our user base”.
What’s your favorite summer destination in and around the city?
I like taking the ferry to Rockaway. It’s super easy and inexpensive but feels like a one-day vacation. I don’t know if that’s too lowbrow an answer but, I mean, you’re on a boat… (cue the lyrics in your mind). And then you’re at the beach, which for me means a rare nap.
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