IR Magazine SmallCap Forum 2022
We attended the IR Magazine Forum—Small Cap 2022 in New York City this week. Joined by over a hundred CEOs, CFOs and IROs, we were all looking for insights into navigating today’s macro-driven investing climate. The mood was rather somber compared to year’s past and we heard the same refrain on repeat: check your investment thesis and your value proposition. Overall, it was great to be engaging with corporate IROs and peers the industry and energizing to be back in person in the Big Apple despite the larger than usual crowds and traffic caused by the simultaneous opening of the U.N. General Assembly.
Key takeaways:
1. It’s tough out there. Everyone seems preoccupied by the darkness emanating from the capital markets with 24/7 analysis in the global financial media. Accept the difficulty of the moment and lead with honor: embrace the truth, even when the news is hard to deliver. Investors need transparency more now than ever before. If you don’t know something, admit it or tell them you’ll find out and get back to them. Find as many reasons as you can to trigger a touchpoint. Relationships evolve over time. An ongoing dialogue is a prerequisite for a second, third or fourth look. PMs are actively looking for companies that can rise above the hubris right now. You know—that fatal disease that can eliminate credibility regardless of rank, size, scale or trading exchange symbol. Small caps can be especially vulnerable to this toxicity. So, manage well and act responsibly. Above, all be courageous. When the markets snapback, you will have already laid the groundwork for a brighter future.
2. Great ideas need to be simple. Portfolio managers regularly complain (and we agree) most presentations are: a) too deep; b) too technical; c) and way too long. PMs want to hear a story; then later fundamentals. In order to tell a good story right now, you should reevaluate corporate positioning in the context of the current operating environment. This means creating a fresh angle, one that resonates with today and will matter in an unknowable future. Don’t just freshen up your color palate, graphics or change a few words. Think through your investment thesis like a banker. Stress test assumptions in your business model. Measure yourself against true 1-1 peers. Challenge yourself in a new 1-minute elevator pitch using the “PASA” approach. First, state what the problem is in an everyday, easy to understand and compelling way. Second, how your company approaches it. Next, what your solution is and why it’s valuable. Lastly, the action you need investors to take. State each of these in one sentence (yes, you read that right) for a total of four sentences.
Now use this as the foundation of your deck (10 slides only, please) and test it. DM us for a free review.
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