The best way to work with an external IR firm.

At our last Melbourne dinner, a guest asked a question that most listed companies pose to themselves - what’s the best way to work with an external IR firm?

• What are the right levels of expectations?
• How do you map them against the appropriate timelines?
• Does it change if you’re a micro/small/midcap business?
• Which outcomes do you track and measure?

I was fortunate enough to have a conversation about this with Ronn Bechler who founded and grew Market Eye, a leading IR advisory firm that serviced many clients in the ASX 300, before being backed and acquired by Automic in 2022. 

And he broke down the question into two streams.

1. How to get the best outcomes when using external IR advisors.
2. How to get the best outcomes from your IR program (with or without external IR advisors).

Both streams are a great resource for listed leaders and anyone else in the space. 

Let's dive in.

(1) Getting the best outcomes when using external IR advisors

Don’t treat your IR adviser as just an external consultant.

Make sure they’re seen as a trusted member of the senior executive team. Build an open, honest, and close relationship with them. 

When I think back on the client engagements that worked best, it was because the CEOs and CFOs treated me - and members of my previous firm - as part of their core team.

Several of the CEOs I advised over the past 28 years are now good friends of mine, and I’m still in touch with many of the Chairs, CEOs, and CFOs I worked closely with.

Be open to your adviser’s guidance and implement their suggestions.

Unless there’s a clear and logical reason not to, just do it. 

The best outcomes I’ve seen came from CEOs who recognised that they didn’t have all the answers when it came to capital markets, and who looked to use us to help fill that gap.

If you’re regularly ignoring your adviser's advice, you probably have the wrong advisor.

Ask your adviser to build both a 1-year and a 3-year IR strategy.

But make sure you hold them accountable to those plans. Share price performance isn’t the only metric for success - many other factors play a role. 

From my experience, the companies that took a medium- to long-term view of their IR program, and stuck to the strategy we developed, ultimately saw the most value.

That included long-term, sustainable growth in shareholder value.

(2) Getting the best outcomes from your IR program

Meet with the right brokers and investors based on your market cap.

If you’re a small-cap company, there’s no point meeting with large-cap funds.

It can be tough to say no to meetings - but doing so helps manage time and resources, and ensures every IR meeting is a good use of the CEO/CFO’s time. 

One company I previously advised was doing 5-day post-results roadshows despite being a thinly traded $100m market cap business. After we implemented a new IR strategy, they reduced the roadshows to 2 days. The key reason? 

They’d been spending too much time with large-cap funds that weren’t going to invest, but were just gathering intelligence on their bigger competitors.

Make sure your Chair builds relationships with your key investors.

You only need one meeting a year - ideally around the time the Annual Report is released, before the AGM. This becomes especially important when you need support for contentious AGM resolutions, need to call an EGM or Scheme Meeting, or face an unwanted takeover approach. 

It’s very hard to secure shareholder backing for what the Board thinks is right if the Chair has never met the company’s major investors.

Don’t judge a fund manager by the size of their fund.

Treat all institutional investors - big and small - with the same respect. In my experience, the best funds to have on your register are the small ones that are growing quickly.

These funds receive regular inflows and tend to invest those inflows back into their existing holdings. 

If your company starts as a small holding, those consistent inflows can drive steady, ongoing demand for your stock.

There’s a lot to take from Ronn’s experience, but one idea sticks with me: good IR is a long game - and it works best when the right people are in the room, having the right conversations, at the right time. 

Whether you’re working with an external IR adviser or going it alone, there’s plenty of learnings here that will help you shape the way investors see or value your company.

If any of these insights really resonated, I’d love to hear it and see if I can answer any questions you have.

Just hit reply 

Cheers,

Ben