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How to attract big investors for Small Cap Companies ?

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How to attract big investors for Small Cap Companies ?

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commented by Catnip
If you work for a publicly traded company, there are simple yet effective steps you and your investor relations director can take now to dramatically increase your company’s exposure and attractiveness to investors thus bolstering share value and shareholder support. These are simple, yet proven strategies for gaining and maintaining a loyal and ever-increasing investor following. Read ‘em and reap.

[1] Stay One Step Ahead of your Investors – Provide accurate and timely information about your Company

How do most investors tell a good stock from a bad one? They don’t…it tells them. It tells them by its trading activity, volume, chart history, etc. But most importantly, it tells them at the click of a button: "View Latest Headlines".

In fact, do that right now. Go online (where most investors conduct their due diligence and make their trading decisions) and view your company’s last five press releases just as an average investor would. Based on what you see, is your company’s stock a buy?
If you recently repainted the building; that’s great! Brag about it at the next office party. But if your company just signed a multi-million dollar global distribution deal--- spend the few hundred dollars on the press release. Better yet…try dividing that one big PR into three or four smaller PR’s. When it comes to substantive positive news, quantity is better than quality, also known as the Shotgun Effect. When the news is not particularly flattering or general housekeeping stuff, the reverse is true; keep those announcements few and far between if possible.

Also keep your company’s website current.  Be sure all recent press releases are reflected on your company’s website and the information is updated quarterly.  If your company is not growing or changing enough quarter by quarter, somebody is not doing their job. (For help with your website IR section or shareholder awareness campaigns, try contacting the people at www.EvergreenMarketingInc.com.

 [2] The Whispers of Happy Shareholders can be Deafening

Word of mouth is still the best advertising there is. If you get the chance to speak directly to any of your shareholders try asking them how they first heard about your company. The answer will most likely be, "from a fellow investor". There are people out there right now who know enough about your company to recommend it to everyone they know….or not. They’re called shareholders. The key is keeping that army of voices well supplied with a steady stream of good news to spread.

Remember, your shareholders can promote and discuss your company and its investment potential in ways and places that you legally cannot. In this Internet / information age, you, as an executive of a publicly traded company, are one of the few who do not have total freedom of speech. Those shareholders are your not-so-silent majority out there for (or against) you on the World Wide Web, 24/7 in places you probably don’t even know exist.

If you really want shareholders to get excited enough about your company to tell everyone they know about it, try getting one of them on the phone sometime or sending a personal email; even if it’s just to say hello and thank them for their support. Speaking directly to the CEO of a company they own stock in is like talking to the Governor to some investors. I’ve seen it. More importantly, I’ve heard about it.

[3] The Hungry Cat Makes the Best Hunter

If a tree falls in the woods and there’s no one there to hear it, does it still make a sound? Who cares! But if your company releases positive news and there’s no one there to hear it, someone will care; your shareholders.

Nothing discourages current shareholders (as well as potential future ones) more than seeing a stock end the session with little or no increase in share price or volume on a day when positive news is released. Sure, the wire services are global, but more than likely, it will only be your existing shareholders who will be watching for and (hopefully) reading your company’s press releases.

As we discussed earlier, the best way to attract future shareholders is by utilizing current shareholders to help do the "hunting". Think about this; if every one of your shareholders fully understood and believed that if there were twice as many of them, the share price might be twice the price it is now. You must keep your army of shareholders constantly growing if for no other reason than the fact that all of your current shareholders will eventually sell your stock and move on…it’s only a question of when.

[4] Get Organized. Get Ready. Get Going!

All eyes in the room are on you. "Okay Boss, what’s the plan?" And then you answer….
Your corporate plan to increase shareholder support and awareness is like a roadmap that details the fastest and shortest route to your destination. Planning the trip is the easy part. Getting everyone else on board for the ride may take some work. That "work" starts with everyone knowing what their specific duties are and the most effective way of carrying them out.

This leads us to; "Get Going!" Activity creates productivity and productivity creates new shareholders, as well as helps keep existing ones.  You should put together a 30 to 60 day calendar that outlines your shareholder awareness program. You should be able to identify specific developments that should take place during each week.

In the beginning, be sure to avoid the getting ready to get ready trap. Once you have the bulk of your operation and team in place, get them started. Don’t get too discouraged if your early results are less than hoped for. This type of undertaking is more like running a marathon than a sprint. It may take a few small steps at first to get your operation up and running for the long haul.

[5] You Cannot Expect What You Are Not Willing to Inspect

Delegation does not equal leadership. You need to stay updated from those actually implementing your shareholder awareness and support programs. What they do right and what they do wrong will determine the success of your program. Your management (and inspection) of the program and those implementing it are key factors in achieving your goals.

These simple yet effective steps will have a huge impact on how current shareholders as well as future investors view your efforts to gain their support by first supporting them. Leadership is easy….if you’re willing to assume it.

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