The best practices of explaining your story (5 live examples)
Why should someone invest in your business? Here are two best practices that listed companies use to communicate their story to investors.
Why should anyone buy your stock on market at the current price?
Does it make more sense than either (1) investing in a different business, or (2) leaving the cash risk-free in the bank?
This is the fundamental question that most companies skip over when presenting to new investors. But there is hope because some companies answer this really well, and that's what we're going to dig into.
In 2024, I was lucky enough to travel around Australia over 52 flights and meet the CEO's and leaders of more than 200 listed companies face-to-face.
Overwhelmingly, I confirmed that sitting down with someone for half an hour gives you such a better insight and understanding of the business than what's typically available on market.
Not only do you get to meet the team and see them present, but you can ask questions and dive deeper in the points that genuinely interest you. You also get to start at these fundamental questions.
- Why this company?
- Why this team?
- Why should I put my money here rather than anywhere else.
In contrast, your experience when looking at a company online for the first time is very different.
Because most ASX announcements are updates on previous releases, they assume so much prior knowledge that it's difficult to follow. It's especially challenging if you're a new investor to the stock because you're unable to answer the questions that can block your first purchase.
Luckily, I found some companies that are starting to do a really good job of resetting these expectations.
They're finding ways to fundamentally explain (1) why you should invest and (2) giving investors the ability to gain a deeper understanding of the business. Through this, they're creating a lot more affinity for the company and the team.
There are two main ways they're doing it and I've included some live examples for both.
1. Welcome video for new investors.
It's a section on your website where you host one video to give new investors an introduction to the company and the team. This is great if you're short on time because after you've recorded your video, it works autonomously for you and scales a face-to-face experience at scale to hundreds or thousands of investors
Linked below are three live examples and I'd recommend you check them all out to get a sense of how personalised it feels for a new or prospective investor.
- ABx Group (ASX:ABX)
- Electro Optic Systems (ASX:EOS)
- Ausquest (ASX:AQD)
2. Summarised investor updates.
If ASX announcements are a page or two in a book, these are chapter summaries. Bringing things together allows time-poor investors a way to get the full update on important movements, and deepen the relationship. It's simple enough to do because it's reusing and summarising existing information but it has a big impact.
I've included two live examples below, including a monthly investor update & live investor Q&A, that show a few different approaches from listed companies.
- Investor update with Lake Resources (ASX:LKE)
- Melbourne Investor Seminar Q&A (ASX:WA8)
All of these give you, the expert and leader, the ability to communicate.
With investors of all experience levels on what you're doing, why it's important, why you're going to win, and why investing in your stock today is the most informed decision they can make.
Because if that's not clear to anyone looking to invest in your business, it's a sure way to lose a new investor.
And there's a simple way to check with the examples I found - are you doing any of this today? If you were a new investor looking on market, would the information available on CommSec convince you to invest in your own stock?
If not, how can you reposition that? Start by going through the live examples in-depth and then reach out to me if you have any questions on next steps or best practices.