This year is expected to see a strong rebound in IPO activity. After Covid-19 caused a downturn in new listings, the LSE saw a resurgence in Q4 2020, with 20 IPOs raising a total of £3.4bn.
Buoyed by vaccine breakthroughs, the UK-EU trade agreement, and Joe Biden’s electoral victory, the strong end to last year has prompted many companies to consider going public in 2021.
When planning an IPO, it is vital that businesses pay attention to communication. It is critical to get the right messages into the market and seen by potential investors, so they know why the company is listing, what the business strategy is, and how the listing enhances the company’s prospects of success. This can make the difference between an IPO that struggles to make an impact and one that sees its shares soar on the first day of dealings.
Below we outline five vital areas of communications to focus on, covering each stage of the IPO process.
Do the groundwork
Key to a successful pre-IPO PR/comms strategy is working well in advance, leveraging regular press releases, multimedia collateral, and profile opportunities with key media up to 18 months before going public. This will encourage consistent media coverage in the run-up to floating, whereas allowing inertia to set in would risk the company falling flat.
Clarity and consistency of messaging are crucial, as is training to equip spokespeople to remain on message even when being pressed hard by the media. It is always wise to consider what questions you would least like to be asked, as you likely will be – and prepare thorough responses for them.
Have a voice in the ‘quiet period’
An effective PR/comms team can strengthen a business’ profile during the so-called ‘quiet period’ between announcing its Intention To Float (ITF) and actually doing so. While activity needs to adhere to the regulatory requirements preventing firms from influencing their share-prices, this need not come at the expense of valuable media coverage on the issues in which the company is already well-versed.
Moreover, amid the crowd of investors, regulators, and prospective clients, a dedicated comms team can help the management team keep staff in mind. These critical stakeholders should receive reassurance at this exciting but often stressful time, as internal communications are equally indispensable to any IPO-proof comms plan.
Indeed, internal and external comms are intertwined, with a failure to brief staff fully likely to result in inconsistent messaging across the business. Well-managed communications can keep channels of communication open, ensuring that employees and executives can celebrate their company milestone harmoniously.
Media scrutiny surrounding the IPO will not dissipate once the business actually floats. First days of trading generally bring businesses unprecedented levels of attention, with their new status as public companies demanding greater transparency and levying stricter regulatory requirements.
If the share price rises significantly on the first day of dealing, take the opportunity to contact the stock market reporters on all the main newswires and media titles to communicate this and seek coverage in their columns. Reach out to dedicated investor platforms, bulletin boards and video/podcast outlets to amplify the company’s business and investment case.
Follow this up by leveraging key company spokespeople for thought leadership opportunities, which build on the expert credentials established in the run-up to the ITF.
An actual listing is only the beginning, not the end, of a business’ journey as a public company. Supporting the company’s share price in the initial months after listing day and beyond is vital – as is ensuring from a PR/communications perspective that the company and management adapt their behaviour to the public markets arena.
This involves taking a more disciplined approach, considering more carefully the impact of announcements on market sentiment and investors and working closely with the IR team a business may have to draft a strategy that covers the far broader range of stakeholders with which listed companies need to communicate and build strong relationships.
Sapience can help your business with its communications needs before, during, and after its IPO. Our consultancy and consultants’ have extensive experience of supporting companies through public offerings, and we enjoy fruitful relationships with a range of national, financial, and other specialist sector media. Perhaps most importantly, we recognise that any comms strategy should reflect the unique needs of the company in question.