…and what an IRO needs to know in planning investor outreach
As the world started to return to in-person meetings in the first quarter of 2022, IROs were faced with numerous challenges and opportunities in planning investor outreach. As we come to the end of the year, many aspects of corporate access have settled into a new normal – but some have changed.
We receive a number of questions about virtual vs in-person formats. While we all learned that virtual can be an effective way to communicate, nothing beats an in-person meeting – particularly when an investor is new to a company’s story or analyzing making a significant investment.
Virtual meetings will certainly remain part of any investor outreach strategy, but we think having a hybrid event schedule will be the new normal. Hybrid meetings are not a great experience for anyone, and we try to avoid them. The number of conferences hosted by the sell side has returned to pre-Covid levels, with some additions from smaller buy side-hosted events. Conferences remain a highly efficient way to see a large number of investors in a short timeframe, and the majority of conferences have returned to in-person events, though some smaller, niche conferences have remained virtual.
Some key questions to ask a sponsor when deciding which conferences to participate in include:
Who will be attending? Sector analysts who attend every sell-side event, or generalists and portfolio managers who don’t often travel?
How many non-US-based investors will attend?
Non-deal roadshows have not returned to pre-Covid levels in person, but are an important part of corporate access. At Raymond James, we currently see about 20 percent to 30 percent of non-deal roadshows held virtually. This is particularly true when targeting smaller markets that might only have a handful of institutional investors.
Field trips are in high demand now: many investors are eager to travel to do a deep dive on a company. They like to see multiple members of a management team, as well as key facilities and operations.
Hitting the right targetWith the ability to work from anywhere, targeting has become more challenging. Many investors have moved away from their company’s main office and several firms have set up shop in Florida and Texas, making trips to these states more productive than they were pre-Covid.
Knowing where an investor is based, and building a travel schedule around that, is key to success. Results from targeting software are important but partnering with a trusted broker will provide on-the-ground knowledge that will help guide you.
Hedge funds are another topic we receive a lot of questions about. We often hear, ‘I just met with that hedge fund’. But many of the largest funds are set up in a pod structure so while you may have met with one team, a completely different team might now want to meet. Having a broker partner will help you navigate to the right meetings.
Many IR professionals have been looking to cultivate retail investors, who tend to be long-term, sticky holders – but this can be a time-consuming endeavor for all but the largest IR teams. At firms like Raymond James – which has an extensive private client group of around 8,700 financial advisers – all advisers have access to the research and recommendations written on a company by the covering analyst. After a conference or non-deal roadshow, the analyst will write a research report so the learnings from that event are amplified to a much wider audience beyond the institutional investors that met with management.
The key to success in this environment is to be open, flexible and ready to pivot when needed. There are a number of challenges in the current corporate access environment, but just as many opportunities!
As one of North America’s leading full-service investment firms, Raymond James offers a full array of capital markets services, strategic advice and planning for every stage of the business life cycle. Our focus is on remaining agile and taking a personal approach to serving the needs of growth companies and the institutional and retail communities that invest in them. Raymond James has been recognized nationally for its community support and corporate philanthropy, ranking as one of the best in the country for customer service, as a great place to work and as a national leader in support of the arts.
ContactMary Turnbull00 1 727 567 2522mary.turnbull@raymondjames.com raymondjames.com/corporateaccess
