What to remember when preparing for an IPO

Going public is a huge step for any company and requires a step-change for companies and the way they communicate. Taking a company from private to public through an IPO (or ‘initial public offering’) and listing on the stock exchange is a demanding process that can take months, or even years, of planning, preparation and execution.

It is tempting for companies to focus just on the result of a listing – i.e., how the newly listed shares are received by the market. However, competitors, potential investors, the media and regulators are paying attention long before the stock begins trading or when due diligence is underway.

An IPO is a once-in-a-corporate lifetime opportunity to share your story and articulate what you want to be known for in the minds of investors, customers, partners, business media and other key stakeholders.

In all the underwriting, price-setting, due diligence, and investor roadshow/fundraising activity, brand-building and communications must remain front and centre. Therefore, for a listing to be successful, proper preparation is needed and requires a robust PR strategy in addition to a strong Investor Relations (IR) programme that covers all three phases of the IPO process: pre-IPO preparation, Listing Day execution and post-IPO.

Remember there is a story in every share price!

We have outlined some key considerations for companies thinking about a potential flotation in the current climate:

Ensure your house is in order:

 Communications, without the behaviour to back it up is pointless so make sure that you don’t just “talk the talk but walk the walk”. Behaviour is the fundamental multiplier for a good reputation and pre-IPO, your company will be scrutinised more than before. By ensuring your behaviour is aligned to your company’s purpose and values, you can position yourself as a “company to watch” with a strong financial future led by innovative leaders in their field. This will also help in the reporting stage post-IPO.

Establish the narrative:

 Before the IPO, you need to develop the company narrative. The messaging should be clear, jargon-free, consistent, and convey your company’s business value. The narrative should articulate the company’s positioning, growth strategy, investment thesis and rationale for going public in an authentic manner. A PR team can help build credibility in the industry particularly those that are complex and scrutinised heavily like cannabis or psychedelics for example to shift negative stigma and help them go beyond cultural niches and into the mainstream.

Sell the narrative:

By subtly raising the profile of a business in the media in advance of the “quiet period”, it will help control the public image and drive visibility and brand recognition to your target audience including potential investors.  It can also help with the continuity of the message and allow any complex or controversial issues to be better understood.  Establishing a consistent media profile in advance will lead to optimal media coverage at listing.

While the primary audiences of IPO communications may be the financial media and analysts, communicating beyond financial audiences will also drive awareness to wider groups including employees, suppliers, customers and potentially policymakers.

Remember, reputation-building doesn’t happen overnight. By the time you go public, you really want your story to be understood and validated and for your reputation to speak for itself. This can have a major impact on how the City or Wall Street will view and value your company.

Prepare the storytellers:

The CEO/Founder/CFO are important figures to tell the business and financial IPO story, so it’s vital that they get in front of the right business journalists in advance of any confirmed IPO plans. Media topics could include commentary or longer form pieces on market trends, company vision and market insights. There are strict rules relating to what you can and cannot communicate on the financial side in the run-up to IPO, so it’s important that a balance is struck between what is externally shared vs what is acceptable to regulators.  At the listing stage, these figures will need to deliver a strong and succinct story that will drum up investment interest so it’s imperative that the spokespeople are effective and efficient. It is worthwhile to invest in getting proper media training organised which is a service we offer here at The PHA Group.

An IPO isn’t just about the business but also who is leading the business and the expertise within the organisation.

Communicate progress to stay visible but remain compliant:

While there are some specific rules around comms before and after “filing” your IPO, you can still maintain factual business communications. It’s important to keep telling your story and sharing your expertise to demonstrate the value of your company.

Post IPO, don’t take your foot off the accelerator! The IPO process can create media interest and excitement among investors, but this can disappear unless your IR and PR teams maintain the market’s interest. Keep the momentum going and leverage on the new media relationships and stories. Regular communication and news flow, will establish credibility in the market and maintain investor confidence.

Taking a company public is a momentous milestone in a company’s history,  by having a PR team with you from the outset will ensure you can get the most from it. If you would like to discuss what a bespoke PR campaign could look like for your business, get in touch with us today.

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