Companies that held virtual roadshows used an average of 4.1 brokers in their virtual roadshow program for Q3 2020 to Q3 2021, up from 2.2 brokers used in the previous year when the Covid-19 pandemic first hit.
European companies use fewer brokers for virtual roadshows than North American or Asian companies.
The number of brokers used for virtual roadshows rises with company size from 2.8 among small-cap companies to 8.4 among mega-caps, which is to be expected given that the number of virtual roadshows held increases with cap size.
But because larger companies typically host shorter virtual roadshows than smaller companies, the amount of time each broker spends decreases with company size. Small-cap companies typically spend an average of 3.7 days with each broker on virtual roadshow activity, compared with mega-cap companies spending an average of 2.1 days.
Number of brokers used at virtual roadshows
Most-used brokers, global
Bank of America Merrill Lynch is the most-used broker for virtual roadshows during the period Q3 2020 to Q3 2021. More than a quarter of companies polled used it during this time. It is closely followed by JPMorgan Chase, which just under a quarter (24.4 percent) of companies used, and Citi, which was used by one in five firms.
What is most notable about the top 20 list for virtual roadshow brokers is how closely it matches previous tables of most-used brokers for in-person roadshows. All popular brokers appear to have adapted to the virtual format and no broker that wasn’t commonly used for in-person roadshows has excelled at the new format.
The top four brokers in this list have all regularly featured in the top five in-person roadshow broker tables over the years. The top 17 brokers for virtual roadshows this year all featured in the top 20 in-person table last year, while nine of the top 10 featured in last year’s in-person top 10.
Most-used brokers, North America
Bank of America Merrill Lynch and Royal Bank of Canada jointly top the list for most-used broker by North American companies. Both brokers were used by more than a quarter of North American companies for virtual roadshows between Q3 2020 and Q3 2021. JPMorgan Chase was used by exactly a quarter of respondent companies in this time.
With the exception of Bank of Montreal, all brokers that featured in last year’s top 10 chart feature again this year, with UBS and Credit Suisse being new entrants for 2021.
All brokers that featured in the 2020 chart for most-used brokers for in-person roadshows among North American companies feature in this year’s chart for virtual roadshows. Morgan Stanley, Credit Suisse, UBS and Wells Fargo are all new entrants to the North American virtual top 10 in 2021, with all being outside the top 10 in the 2020 virtual table.
Most-used brokers, Europe
There are four brokers topping the list for most-used broker by European companies: Bank of America Merrill Lynch, Berenberg, Jefferies and JPMorgan Chase were all used by one in five European companies for virtual roadshows from Q3 2020 to Q3 2021.
Jefferies is new to the top 10 list for European companies this year, having been in neither the virtual nor the in-person table in 2020. Bank of America Merrill Lynch, Berenberg and JPMorgan Chase are all climbers, while last year’s most-used brokers for both in-person and virtual roadshows currently sit in joint fifth in this year’s virtual chart.
Bank of America Merrill Lynch, Citi and JPMorgan Chase have all been used by more than a third of Asian companies polled for virtual roadshows during the period Q3 2020 to Q3 2021. UBS headed last year’s tables for both in-person and virtual roadshows. This year, along with HSBC, it has been used by three in 10 Asian firms for virtual roadshows.
All brokers in this year’s most-used list for virtual roadshows by Asian companies were in last year’s table for in-person roadshows, while HSBC is a new entrant in the 2021 virtual roadshows top 10.
Satisfaction with virtual roadshows
Approaching nine in 10 IROs who went on virtual roadshows in the past year express satisfaction with the experience. Half of IROs globally are very satisfied, giving a rating of eight or more out of 10, while 9 percent give a perfect score of 10 (extremely satisfied).
European IROs are the least satisfied with virtual roadshows, with just over eight in 10 satisfied, 38 percent very satisfied and one in nine dissatisfied. On the other hand, six in 10 North American IROs register high satisfaction of eight or more out of 10, and 13 percent give a perfect 10/10 score for their experience.
There is little difference in satisfaction ratings given according to company size. Satisfaction ranges from 84 percent among small-cap IROs to 91 percent among large caps. The one notable rating is that a quarter of mega-cap IROs are extremely satisfied and give a 10/10 score.
In-person vs virtual roadshow satisfaction
In-person vs virtual roadshow satisfaction levels
A greater number of IROs who have conducted virtual roadshows this year express satisfaction with the experience than do IROs holding in-person roadshows. Just over three quarters of IROs who have been on in-person roadshows in this time give the experience a positive satisfaction score, compared with 88 percent of virtual roadshow holders who are satisfied with their experience.
When it comes to high satisfaction ratings, however, in-person roadshows fare better. Among IROs who have been on the road during this year, 57 percent are very satisfied; for IROs holding virtual roadshows, only 50 percent are very satisfied with that format. A third of those who went on the road express extreme satisfaction with the experience, giving a perfect score of 10.
Benefits of virtual roadshows
Benefits of virtual roadshows
We asked IROs to comment on the benefits virtual roadshows bring over conventional in-person roadshows. Time is the most-mentioned advantage, with the increased time benefits of virtual roadshows mentioned by half of all IROs who commented.
The cheaper cost of virtual roadshows is the next most-mentioned benefit, followed by the fact that virtual means not having to travel. Approaching a quarter of IROs who comment also mention that virtual roadshows are able to access investors in locations that would be impractical to visit in person.
Regionally, the travel benefits are higher for North American IROs and the cost benefits lower, while the opposite is true of European IROs. Increased locations hardly matter to Asian IR professionals, while greater senior management involvement in virtual roadshows is mentioned much more by Asian IROs than by North Americans or Europeans.
The importance of cost as an advantage of virtual roadshows diminishes with cap size. Half of small-cap IROs mention it as a benefit, compared with just 17 percent of mega-cap IROs. Access to investors in more diverse locations is a more greatly observed advantage for larger companies than smaller companies. Location tops the list of most-mentioned benefits by mega-cap IROs, along with more time and not having to travel.
Benefits of virtual roadshows: Comments
Able to meet more investors and cover broader geographies in one go
India, large cap, materials
We can save money and time spent on travel. Also, some senior managers who are not able to join IR meetings usually can join virtual ones, allowing them to know about investors' views. We believe it also helps investors to understand our company better
Japan, large cap, healthcare
Flexibility around schedule and more frequent updates – so it can be a series of mini-update calls, rather than wait for the meeting to be arranged
Thailand, large cap, real estate
More participants and more meetings with less travel
Philippines, small cap, industrials
The time saved traveling is the key benefit, and the more efficient spacing/more compact nature of meetings frees up time for management to work
UK, large cap, industrials
Reach: you can target new geographies, eliminate lead times in airports, on transport, and so on. Efficient use of management time if meetings are productive
Sweden, large cap, other
A higher percentage of investor meetings are now in the virtiual space. More direct contact with investors for organizing meetings and for feedback
Italy, large cap, financials
Easier to engage senior management. Facilitates the realization of a higher number of meetings compared with physical format
Greece, mid-cap, energy
More efficient without travel time and doesn't disrupt schedules in the same way
UK, mid-cap, financials
Not having to travel allows you to spread roadshows over a wider timeframe and also to talk to different geographies on the same day
Portugal, mid-cap, utilities
Time-efficient. Global remit, can flex to suit different time zones: access to greater investor base. No travel logistics to worry about. Cost-efficient. Better for environment – no travel and paperless
UK, small cap, other
No travel time. Logistics are so much easier to manage. You can meet more investors in one day as time usually spent traveling can be used to see more investors. Not limited to a certain city, which allows targeting of a higher number of investors
Germany, small cap, industrials
Easier to have management participation, given no travel. More portfolio managers attending meetings, given lower commitment. Ability to cover multiple markets in a day and ability to do half-days
Canada, large cap, consumer discretionary
Being able to communicate with investors in an afternoon rather than traveling and taking a few days to get places to conduct the meetings
US, large cap, industrials
You can spread it out: two half-days instead of one long day
US, large cap, materials
Less travel allows for more flexibility, especially for different time zones
US, large cap, materials
More convenient. Better attendance. Expands regions we can do roadshows in, such as regions with too few meetings to justify the time and cost of travel
US, large cap, real estate
Less time spent traveling/away from the office; opportunity to meet with investors outside the US
US, mega-cap, healthcare
Saves on travel time and costs, can see more than a regional group of investors, don't have time gaps or filler meetings with small investors
US, mega-cap, consumer staples
Travel efficiency, lower cost, better for the environment
US, mid-cap, financials
We like that it is less demanding of management's time
US, mid-cap, consumer discretionary
Meeting people in time zones that are expensive for our limited budget. No doubt that it's much more efficient: physical movement between meetings takes time away from actual meetings
Canada, small cap, other
Less travel. Higher-quality conversations and more conversations (because you aren't traveling)
Brazil, mega-cap, technology
More meetings can be held in a day, given simpler logistics: no travel and efficient transitions between meetings. Some meetings can be more intimate given investors are often based in their own home and so feel less formal
Australia, small cap, consumer discretionary
An opportunity to easily meet people from all over the world. One-on-one meetings seem as effective as in-person event
Poland, small cap, technology
Challenges of virtual roadshows: Comments
The key challenge of virtual roadshows is to gain the level of connection with investors that can be achieved with an on-the-road visit. It is more difficult to develop interpersonal relationships in the virtual format and investors are often less engaged than when present in person.
The technology itself can contribute to this lack of engagement as it allows for investors to interact without video or to be easily distracted and dip in and out of meetings. Some IROs suggest a fatigue is setting in with the virtual format.
Group chit-chat is limited in a virtual meeting and we tend to learn quite a bit about each other during the informal part of a meeting. Often, it's difficult to determine how engaged the listener is during the presentation
Canada, small cap, other
Difficult to have senior managers present. Larger meetings and investors that don't have their cameras on make it difficult to engage with them, especially when it's the first time you meet them. More passive investors in meetings
Chile, large cap, materials
Screen fatigue/occasional technology challenges. Typically, management uses IR's laptop so I have to take notes on paper
Cayman Islands, mid-cap, communications
Difficulties in understanding foreign accents. No ability to read body language
Bermuda, small cap, financials
Every meeting feels the same. Presenter fatigue sets in earlier and meetings later in the day can fall flat
Australia, small cap, consumer discretionary
Virtual roadshows are becoming more synthetic, less sympathetic. Investors are offered too many virtual meetings by brokers/companies and they seem to have started losing interest in meetings
Turkey, small cap, industrials
Virtual roadshows take away the personal touch of communication/personal connection with investors, which is important for a roadshow
India, large cap, consumer discretionary
Not much interaction with investors as some opt to just listen to the presentation and keep their cameras turned off
Philippines, large cap, real estate
Reliability of virtual meetings – may experience occasional connection and other technical issues
Thailand, large cap, real estate
Technology and ease of communication. While technology has held up well, there can be occasional issues. It can be difficult to navigate questions and read body language. Often, people have cameras turned off
UK, large cap, industrials
Less energy and less non-verbal communication does not work well with investors we have not met in person before
UK, large cap, industrials
One-to-ones are fine, but group meetings can be challenging, as it is difficult to generate dynamics the way you can with in-person meetings. Group meetings unfortunately tend to be too presentations-oriented
Sweden, large cap, other
Sometimes difficult to know who is speaking, especially if cameras are off. Topics sometimes jump back and forth in a virtual setting; it's less structured. You repeatedly get the same people during meetings as it's easy to keep joining virtually. Technical problems prevailed during most
Belgium, large cap, industrials
Various conference systems. Technical quality of meetings varies a lot. Many participants do not use their webcams, which makes personal communication impossible
Germany, mega-cap, real estate
Many no-shows. Schedules seem harder to fill. No informal/body language. Less human. Also, time spent in planes/hotels can sometimes be very positive for reflecting on the job and thinking without being disturbed
France, mid-cap, financials
People have to be there in time. Easier for investors to cancel
Germany, mid-cap, materials
Can't be sure people are engaged, people find it easy to miss sessions, less chemistry for new relationships
UK, mid-cap, financials
Finding interest on behalf of investors after so many remote meetings. There is a lot more supply, even of management, but investors are much more picky
Portugal, mid-cap, utilities
Tech working. Trying to recreate that in-person feeling with multiple faces connecting from various locations. Virtual meeting fatigue. Lack of engagement
UK, small cap, other
The personal element is still missing. It's harder to get good chemistry than with in-person meetings. It's more tiring to keep focus as presenter than it is with in-person roadshows by the end of the day
Germany, small cap, industrials
Sometimes, during group meetings, nobody has the camera turned on. It is very difficult to conduct meetings when you do not see any reactions
Poland, small cap, technology
Lower-quality meetings are more frequent as it's easier for an investor with limited interest in the company that is simply looking for insight in the industry to take a virtual meeting rather than an in-person meeting
Canada, large cap, consumer discretionary
No elevator talk. Limit to number in a day without Zoom fatigue. Harder to focus management sometimes
Canada, large cap, consumer discretionary
The virtual platforms are becoming a bit fatigued. Early on, there were some growing pains, then the roadshows were very effective, but now they are becoming less effective
Canada, large cap, materials
You don't get the informal time for talking between management and the sell side
US, large cap, materials
Challenges have become scheduling multiple consecutive days for non-deal roadshows if using more than one broker as host. Buy-siders seemed more willing to meet in person as opposed to virtually
US, large cap, other
Ability to do face to face and eye contact less effective, maintaining investor interest, investor fatigue, and some investors waiting for return to in-person meetings
US, mega-cap, consumer staples
Little relationship building. Distractions. Not forced to see smaller funds in one city
US, mid-cap, healthcare
Lack of connection with IR team, which is off-camera listening, compared with just management on screen
US, mid-cap, consumer staples
