We have experienced a steady increase in direct investor access over the past three years. This trend is expected to continue for several different reasons. In our discussions with IROs, the top three reasons stated are:
The rise of dedicated investor access teams Organizing corporate access events without the support of traditional intermediaries can be a challenging task. Identifying the right counterparts requires data and experience, while reconciling the busy calendars of the investor contacts and the company’s presenting team remains a chore. Large and mega-cap companies were therefore the first to complement broker-organized investor events with direct investor outreach by dedicating staff to an investor access desk.
The role of buy-side corporate access teams Conversely, large institutional asset managers have also recognized the need to become accessible directly. To facilitate this, those institutions have installed corporate access desks. These desks are responsible for channeling interest and facilitating the IR team’s efforts in effectively reaching out to the firm’s portfolio management and buy-side research teams. The most sophisticated among those desks also provide digital tools via their website to simplify the process even further.
Complement direct access with traditional approaches Broker-organized roadshows and conferences will continue to play their role. Used smartly, direct investor access will complement traditional approaches with the aim to widen the addressable audience, target specific accounts and increase the effectiveness of time spent in investor meetings. In our experience, IR professionals are ready to pursue a mix of approaches in the same event by supplementing broker-organized events with meetings arranged directly.
Maria Töpfer, ACCNITE
Leverage technology to manage investor engagement Investor engagement management is a process rather than a series of one-offs. A good tool will support the IR team throughout the engagement process. Starting from identification and segmentation to keep track of investor touch points all the way to direct outreach and collecting post-meeting intelligence, working with smart IR applications has the potential to provide significant support to the modern IR professional.
IR applications that combine externally available data with data proprietary to investor relations teams provide intelligence to make the best possible use of such data. Such digitalization of mission-critical workflows will provide efficiency gains regardless of a company’s market cap or the size of the IR team.
Some tips for a smooth investor experience Keep it simple: When reaching out to investors electronically, make sure the process is simple and self-explanatory. Investors will appreciate it if they can save valuable time as well.
Keep it concise: Think of the introductory paragraph as the elevator pitch for your meeting. On opening the invitation, your audience should be able to understand the process at first glance. Make sure the call to action to initiate next steps is clear. Include a helpful link to your website to facilitate those who would like to learn more about your company.
Keep your audience in mind: Different investor types may have different motives for following your company. Do not overload your introductory paragraph by trying to cover them all. Consider personalizing your invitation by breaking down your target audience into categories.
Provide alternatives: Do not risk a no-response caused by your proposed times not matching a potentially keen investor’s schedule. Be sure to include the option of arranging alternative times.
Consider your timing: Be sure to minimize the chance of invitations getting lost in an inbox that fills up overnight. If you are reaching out to investors in various time zones, you may want to split up the process to improve your chances of catching the investor’s attention during the day.
Summary Offering direct corporate access has become an important element of institutional investor relations. IR teams of all sizes can simplify the process of meeting co-ordination with the support of a dedicated tech tool. Connected data will help to identify priorities and personalize the approach. A good process will cause minimal friction and consistently stay on the digital track. Direct investor access can be part of a digital journey enhancing effectiveness through increased transparency and propelling long-term investor engagement.
Maria Töpfer is one of the founders of ACCNITE. Prior to ACCNITE, she spent more than five years in investment banking where she focused on corporate finance, equity capital markets and corporate brokerage. She holds a BA in international business management and an MSc in finance
