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If an initial public offering (IPO) is part of your long-term business plan, making some preparations now will ensure that you and your organization will be ready to fulfill your responsibilities – and attract targeted investors – when the time is right for your company to go public. Here are seven simple strategies for future public companies to consider.
Frankly, for those public companies that have developed bad investor relations habits - and you know who you are - these strategies apply to you as well.
Be curious to hear from those who have recently traveled down this path or are preparing to go down this path on steps they took to prepare for life as a public company.
I wanted to be sure you saw this updated piece we just did on the two dimensions of managing activist risk. Its been my experience that the former dimension is the harder of the two to actual manage - which is both surprising and sad to me.
Let me know if you see anything that needs to be added or tweaked.
I had brunch with my brother and his family yesterday to celebrate my oldest nephew’s 17th birthday. Amid all the surreal conversation about what colleges he’s considering and my utter confusion at how he can possibly walk, let alone be comfortable, with his jeans that are in a constant struggle with gravity, I had an epiphany - I am definitely old school at heart.
I still have a record player and a sizable collection of music on vinyl. I still have - and use - a VCR. I actually think most NFL “throwback” jerseys are better than the current game day uniforms (I said most, not all. Sorry NIRI Rocky Mountain Chapter). I am convinced that droopy jeans will prove to be the leading cause of hip displacement for my nephew’s generation. And I still believe media relations is a key component of a forward-thinking investors relations program.
I know - nutty, eh?
Listen, if you’ve ever read this blog before, you know how strongly I believe that investor relations needs to be embrace the power and potential of new technology. And I firmly believe that. That said, I am growing increasingly concerned that more and more IROs are overlooking media relations when building their IR programs. Research continues to show that the media - both financial media and trade media - are a highly influential source for investment ideas for buy- and sell-side investors. And, not only is it influential, it’s an effective and efficient channel too - particularly for smaller companies who can use the market cap-ambivalent trade media to further demonstrate their new product pipeline and thought leadership, among other things (read: the key intangible assets investors look for when conducting due diligence).
Before I go all Oliver Stone with my conspiracy theories, do you agree that media relations is becoming a dusty tool in the IR tool box?
Nice piece in Investor Relations Musings last week about the aspects of sales and marketing that apply to investor relations - a topic that gets regular air time. In fact, Margo Happer recently did an interview on this very topic with IR Alert that I thought was particularly well done.
Anyways, what caught my eye in the “Musings” post was the following comment Dave Hogan made: “The numbers are hugely important, but it’s not ALL about the numbers.” I agree… sorta. In my opinion (or IMO, as the young people say), IR is not ALL about the numbers though it is all about A number - valuation. In other words, those companies that treat IR solely as a compliance function are leaving money on the table - and that’s a number that matters!
I don’t know about you, but the last two weeks have been a blur. No, not because of the Olympics but because it’s that wonderful time of year when year-end earnings drafting collides with annual report development which bumps into proxy preparations and the return of the non-deal road show.
So, forgive me, I need to circle back to something that came out a little while back. I thought this piece from the IR Alert offered an interesting takeaway from the Olympics - and big dollar corporate sponsorships in general. One of the most telling parts of this interview was how Jack Carsky (head of global IR for Visa) responded to the question about measuring success of such sponsorships: “Not much of this [bump] has to do with IR—but it’s just nice to draft off of them (marketing and advertising). Plus, all of Wall Street sees those ads and so do our analysts. You can’t look at any Olympic venue on TV right now and not see our name on it. So it does have impact.”
What’s caught my eye about this quote is what he didn’t say. First, he didn’t specifically mention how important “brand” is as intangible asset to the company but clearly it must be or how could brand marketing and advertising create any “draft” for the valuation. I wonder why he didn’t talk more about branding and valuation? Second, he didn’t specifically mention the impact such branding has on the company’s appeal to retail investors, though in this interview he did say, “... anything that advances value or your brand and a wider understanding of the company and what you do, can only make the IRO’s job easier.” Maybe I didn’t I missed it but I didn’t see any substantive discussion on the retail community, which is odd given that roughly 50 percent of Visa is held by retail investors.
One other Olympics-related topic that confused me - what, exactly, are the rules to curling!??! It seemed to be the only event on whenever I tried to watch and, as hard as I tried, I could not break the code on the objective/scoring for the sport.
