A Rant On Investor Relations

Dear Public Company CEOs / Execs,

You are not doing any service to your companies by going to CNBC, Bloomberg or interviews with Wall Street Journal, New York Times or Washington Post. Investors worth their salt know that you are not sharing any useful information on financial or news media. They are busy looking at your Investor Relations page on the website. If you want long term shareholders, start by improving your Investor Relations website.

If your company is great at selling your product then it can certainly sell the company’s common stock to investors. There is a reason why Netflix’s market capitalization has increased even though their business model might have certain weaknesses. Nobody is perfect or can remain perfect but if you can communicate your company’s thinking as well as document it properly you will attract shareholders who will not be swayed by your quarterly performance.

Here are some recommendations that can help you get started:

  • Website that loads fast and is mobile friendly.
  • Have a separate IR website like Netflix if you think it will help investors.
  • Organize and properly link all the relevant materials.
  • Share transcripts from investor conferences because not every investor can attend all of them.
  • Please share most frequently asked questions (FAQs) on your website so that investors don’t waste time of your investor relations team.
  • Present upcoming important dates for investors prominently
  • Make it easy to receive investor relations material via channels other than email such as RSS, Twitter, Facebook and LinkedIn. It will be easier for investors to evangelize your company’s stock to other investors.
  • If you can share key financial and / or sales figures or metrics investors need to focus in an organized fashion, investors will reward you back. For ideas, look at Swedish Match Business website.
  • Present compensation of key executives and the board properly on the website including their trades on the website. This matters to long term shareholders, why not make it easier for them to easily access this information instead of trying to hide it in the proxy statement.

If you even follow some of this you will get a positive feedback loop from investors who are interested in investing and cheer-leading great companies. Not everyone in the investment community is just looking to make a quick buck.

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