4 Reasons you need the services
of an investor relations firm
Investor relations (IR) refers to the ongoing activity of companies communicating with their investment community.
This is usually a blend of regulatory and voluntary activities and is essentially the part of stock market life that sees companies interacting with:
- existing shareholders,
- potential investors,
- financial analysts, and
While the practice of building and maintaining strong relationships with your investor community is important, it is often a time consuming one. This is because the tasks of effective investor relations is not only to communicate with the investor community, but to help your company gain access to capital, and achieve liquidity and fair valuation of its shares.
Not understanding the full scope and importance of this practice is where growth stocks fail. For this reason, here are 4 reasons why a growth stock may want to consider hiring the expertise of an experienced investor relations firm:
1 Easier access to capital
Investor relations firms have the ability to help raise capital much faster than you trying to do it alone. IR firms have far fewer barriers to entry, when it comes to entering into a dialogue and developing relationships with investors.
In some cases, these are relationships that are pre-existing and simply require participants to become cognisant of the company and its investment proposition.
2 Helping you achieve liquidity
One of the fundamentals of all investor relations efforts is to attract liquidity, i.e. frequency of trading in shares. However, if this is conducted poorly, your efforts could have the opposite effect.
IR firms have the expertise to profile and explain your company to the investment community in a way they understand. This in turn assists in creating greater awareness of your company.
In addition, depending on the availability of shares, your company can be assisted in attracting pools of buyers and sellers, as well as creating the potential for higher frequency in the trading of your shares.
3 Market valuation that is fair
Another priority of investor relations is to help companies achieve a fair market valuation, which is reflected in the share price.
IR firms help manage investor expectations in relation to the company’s past, current and future performance. This enables your company to detail its own record of performance and strategy, using publicly disclosed information.
It will also help your company understand how it is being evaluated, and whether the market’s expectations and understanding is in line with your own.
4 Transparency for your investor community
It is not always an investors market. Naturally, other factors such as the economic situation, confidence in management and company’s activities, can have an impact on how a company is perceived, valued and funded.
The aim of investor relations is to share a greater awareness of the company’s investment case and commercial activities. This way, investors and potential investors can make more informed decisions on their current and future involvement in the company.
The balance is about updating those who already follow or invest in the company, and profiling the company to new audiences.
Why Equity Alliance?
When it comes to effective investor relations, Equity Alliance offers a market leading service like no other. We are dedicated to hand-picking small-cap companies with unlimited potential, and connecting them to investors looking for companies on their way up.
We are seasoned IR professionals, who know what you need and what you’re up against. Our investor relations programmes are tailored to your specific objectives and investor community.
To learn more about Equity Alliance, contact us today!