Is it becoming more difficult to talk with your shareholders? Are you hearing the same old complaints over and over again? Do your shareholders lack the enthusiasm for your company they once had?
That’s called “Shareholder Fatigue.” They have been long-term holders, through the good times and through difficult times. If your stock is steadily going up – no problem. If your stock price has leveled off or heading down, that is a problem. At that point, your investors are looking to move on. They are just waiting for a better price so that they can redeploy their capital in another company that they perceive to have better prospects. You were at one time that investment opportunity that had great prospects!
Once investors get the sense that you are gaining traction on your strategic business plan, they will certainly be open to a conversation to get a feel for what is coming down the pike in the coming quarters. Messaging becomes very important. Investors want to understand what steps management is going to take to grow the business from that point forward. They will want to know:
- Your strategy and the metrics they can follow to determine whether you are making progress on “righting the ship.”
- What are the opportunities and the potential catalysts that can drive the company forward?
- What is the company going to look like in the next 12 – 24 months?
Interfacing on a consistent basis with potential new investors sets the stage for generating new interest in the story.
Attracting new investors by developing relationships with investors on the “the Street” does require some management time. CEOs and CFOs must be willing to play their part in developing and maintaining those relationships. One of the reasons a Board of Directors hires a CEO – in addition to operating the company efficiently and profitably – is to drive shareholder value.
Participating in investor conferences is one way to start the process. However, more often than not, your story is forgotten by the institutional investor almost immediately after the Zoom meeting concludes. The story needs continuous reinforcement. It takes more than a one-off meeting at a conference to get an investor to start buying your stock. Results from a conference participation are “a mile wide and an inch deep.” Those 1×1 meetings with investors need to be followed-up on a consistent basis. It generally takes up to 7 interactions before an institutional investor takes a position in a stock. “Out of sight, out of mind.”
It is all about establishing and maintaining relationships and that takes consistent outreach to investors that take a meeting with you at a conference. You don’t have the time for that, you’ve got a business to run. That’s what we do at Lytham Partners – building and maintaining the relationships that can drive value on a sustainable basis as you execute on your strategic plan.
If it’s time for a new and energized shareholder base that sees the value and the investment opportunity that your company represents. Let Lytham Partners create the pathway for that to happen!
written by Joe Diaz
We would love to discuss how we can bring value to your company. Click below to schedule your free, no obligation consultation today.