The Art of Outsourcing: How IR as Gatekeeper Can Help Small Caps Thrive
Investor Relations is a fast-paced, multi-hat wearing cat-herding job, but when it all comes come together, it is a sight to behold—something akin to the opening stanza of a beloved song.
Given the vast number of public companies in North America—over 25,000—vying for investor attention, it can be challenging for small caps to gain visibility and attract investment without a specialized network of expert support. Third-parties (ourselves included) are a cost-effective way of navigating the myriad of demands, responsibilities and expectations of the investor relations function. The right team of providers can showcase your company in the most advantageous light to the widest possible audience. When you factor in the range of players orchestrating your company’s public persona including IR counsel, conference providers, digital advertisers, paid analysts, content creators, and distributors, sometimes that sweet melody can turn into a cacophony.
Effective vendor management though, can help small caps optimize resources and get the most out of their IR budget and strategy. Much as a leader in a band, or a conductor in an orchestra leads the group of specialist players, IR as "gatekeeper" can be a force for good. We know “who's who in the zoo” which can ensure tasks are completed on time and to a high standard, while gatekeeping so management can focus on running their business. Within this hierarchy, IR is responsible for vetting, managing, and recommending the best action in alignment with your IR goals.
While we recommend sticking to your annual plan to achieve your goals, it's important to remain flexible and adaptable as circumstances evolve in Q2. If your goal is to increase retail investors, be sure posts on social media and other online platforms are adding value to the conversation. If you are chasing sell-side coverage, which can help attract larger investors when it’s time to a fundraise, make sure you have a solid investment case and effective presentation materials. Ultimately, your Q2 IR strategy will vary based on Q2 and Q3 goals and budget. This is a good time to review your current financial position, growth targets, performance.
Small organizations need to rely on a trusted team of advisors: reputable ones will always guide you in the right direction. And above all—be patient, your initial spend, may not bear fruit immediately, but the wait is often worth it. Taking a long-term perspective can help you achieve greater harmonies and get one step closer to your goals.
Tips for investor relations vendor management for companies on a limited budget:
Prioritize Needs: Identify the key services/projects that are critical to your investor relations program and prioritize them based on your budget and resources. Focus on vendors that offer the most value for your money.
Negotiate Pricing: Always negotiate pricing to get the best possible rates. You may get better pricing by bundling services.
Seek Referrals: Ask for referrals from other companies in your industry or network to find reliable vendors that offer quality services at cost-aware prices.
Monitor Performance: Monitor vendors to ensure that they are meeting your expectations and delivering value.
