Your company is up and running with a successful track record of sales and earnings and you’ve decided to conduct an Initial Pubic Offering (IPO). How do you prepare for a seamless presentation when there are so many key players and complicated logistics involved?
Pick Your Team Wisely
Start by choosing the right investment bank. Bankers are critical to your success because they arrange the road shows, extend the invitations and help sell the company to potential investors. Other outside team members will include your law firm and the venture capitalists and/or the private equity firms that provided seed money to get the company to this point. They are ready to cash in.
Then choose the executive team that will participant in the IPO road show visiting the investment community in the U.S. and globally, as appropriate.
Excellent presentation skills are a must. Additionally, chemistry and trust among team members is important to the team’s success as they will be spending a lot of time together in meetings and on the road.
Make it Sizzle
The company’s top executives are the key players. They will be making the detailed presentations that demonstrate a deep knowledge of their company and the competitive environment. As we mentioned in our post on venture capitalists, it’s essential that the presenters identify the key messages which will excite potential investors. Lead with the sizzle to bring the presentation to life.
For example, we recently worked with Volaris, the ultra lost-cost Mexican airline, whose goal is to wean Mexicans from buses. The carrier’s key marketing message is “why spend 40 hours on a bus when you can get to your destination both within and outside Mexico by air, often for less than $100?” The company also has a brand new fleet of planes offering safety and security. Low cost and peace of mind will sell seats.
The term “road show” is very apt because that’s what it is, a traveling show (some say “circus”) in which each presenter has a role in crafting and delivering a compelling story about the company and its future prospects. You want investors on the edge of their seats engrossed in your story and not looking at their watches wondering when the presentation will end.
You can’t fool anyone. Your presentation needs to be backed up by hard facts because investors check and double-check every number, fact and statistic.
Prepare the Presenters
An internal coach, or an outside training consultant, can help make the presentation flow. Many CEOs and CFOs are not natural presenters. Their intelligence and drive took them to the top. But they may sweat bullets when they have to stand in front of an audience and get grilled by potential investors.
Preparation, as always, will help to calm nerves. Look the part by wearing proper business attire. Wedbush Securities analyst Michael Pachter was quoted as saying that Facebook CEO Mark Zuckerberg failed to exhibit “respect to Wall Street” by showing up to investor presentations in his trademark hoodie when taking Facebook public. Pachter wasn’t alone in his critique.
Each presenter needs to understand his role and then practice, practice, practice until he is entirely comfortable with the material. The script needs to be tailored to individual personalities and styles like a bespoke suit.
Several CEOs we’ve coached were uncomfortable in a stand-up role. It’s perfectly acceptable for the CEO to deliver brief remarks about his vision for the company and then turn the meeting over to his COO and CFO to carry the bulk of the presentation.
The Final Check List
We’ve never been to an IPO rehearsal where the presentation wasn’t tweaked by adding, editing or deleting material. A coach can help to ease the anxiety of mastering new content.
Finally, a senior executive from the IR or PR Department needs to ensure that rooms are booked, flights are arranged, the projector works and the handouts get to the proper locations in each city. We once traveled to London with an IPO team we had coached. Everything was in place. However, we discovered the presentation room had no shades and was flooded with sunlight, making the slides virtually invisible. Thus, the best laid plans need to be tripled checked.
Whether you’re presenting to sell-side analysts, venture capitalists or to investors in an IPO road show, you need to be prepared. So many things could go wrong. You won’t have a second chance to make a first impression. And impressions really count when you are asking investors to part with their money.
- Venture Capital Firms Invest in the Deal…and the People (presenting-yourself.com)
- Why Should a Sell-Side Analyst Recommend Your Company? (presenting-yourself.com)
- Venture Capitalist: Tech Activists Are Like Nazis (bits.blogs.nytimes.com)
- LOYAL3 CEO: IPOs For The Small Investor (ceo.com)