5 Things to Address in an Investor Presentation
Investor relations has changed. Gone are the days of suit-clad promoters power-dialing brokers on cold-calling sprees, attending endless conferences and pounding the pavement on never-ending investor road shows to get in front of fresh capital. The truth is that along with just about every other industry, IR has gone digital – the question is, has your IR program kept pace with the shift?
The proliferation of smart phones and high-speed WiFi over the past decade means we now spend more time online than ever before. This shift has also changed our buying behavior – we can now peruse our options online and purchase products without ever having to set foot outside our homes. Marketers realized early on that the way forward was to focus their efforts on the billions of people browsing the internet at any given moment – today, the digital marketing industry is worth around US $322 billion.
This shift in consumer behavior is no different when it comes to buying stock. Thanks to online brokerage platforms that let users buy and sell stock with the push of a button, and social media platforms like StockTwits and Reddit where retail investors swap investing tips and brag about their latest trades, it is now imperative for companies to market their stock to audiences online.
Covid-19 has only increased that urgency. According to a recent study, global online content consumption doubled in 2020, to nearly 7 hours per day for the average person. And with the entire planet trapped at home in quarantine and spending the majority of their days online during the pandemic, a whole new generation of retail investors has emerged. Hungry and looking for that next potential 20-bagger, this audience is primed to buy stock – so you’d be wise to make sure your company is on their radar, and that its story resonates with them immediately.
Once potential investors have found your company, they’re going to check out your website, past press releases – and your investor deck, which should be posted in a place that’s easy for them to find.
As with any product, when you’re marketing a stock to investors, you’re facing competition from other “products” on the market. There are plenty of other publicly traded companies out there, tens of thousands in fact, with intriguing stories, dazzling financials, and top-notch management teams. So how is your company going to compete? Here are a couple of questions you can use to determine how you’re going to position your company effectively in your online investor presentation.
1. What do you do?
Sounds simple, but it’s amazing how many CEOs actually can’t summarize their company in a way that makes sense to outsiders. Stary by summarizing what the company does in one paragraph, and eventually try to whittle this down to a single sentence, preferably not an overly long, heavily punctuated run-on sentence.
2. How do you do it?
This is where you can get into a bit more detail, if necessary. For example, if you’re a company that sells fruits and vegetables, you probably don’t need to go into too much detail about how you do this, unless you’re an e-commerce platform that sells fruits and vegetables on a subscription model basis using machine learning technology.
3. How do you make money?
Again, it is amazing how many companies devote page after page on their investor presentations to explaining what they do, without explaining how they make money, or intend to make money. What is your business model? How will this evolve as you grow? Is it scalable? Even if you’re a mining company, it’s not as simple as “we make money when we find gold”. Explain your plans to keep exploring the areas around one project if you make a discovery, for example. You don’t need to get too granular here, but give investors a clear picture of how you’re going to make money.
4. What is your “moat”?
In other words, what is your competitive advantage? How big is the market, and where does your company fit in? What are the barriers to entry, and how are you unique compared to your competitors and peers?
5.Who is behind the company? A summary of your leadership team. It is worth hiring a professional copywriter or marketing expert to write bios for everyone on your team, as people are often not great at writing their own bios. Get each executive to provide bullet point facts, and leave it to a writer to summarize them in a comprehensive way.
5. Who is behind the company?
Who is behind the company? A summary of your leadership team. It is worth hiring a professional copywriter or marketing expert to write bios for everyone on your team, as people are often not great at writing their own bios. Get each executive to provide bullet point facts, and leave it to a writer to summarize them in a comprehensive way.
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