Raising funds for your business can be a very long, very involved process. Last week, we covered the importance of investor communications in due diligence, considerations for going public, and the role that data rooms can play in pre-IPO investor communications. Now, we’re moving onto the next stage of investor communications: investor roadshows.
Investor roadshows are events held by a company in order to communicate with current and prospective investors, in an effort to both keep your shareholders informed, and to raise funds for your company as you head towards your Initial Public Offering (IPO). As well as this, many companies now host non-deal investor roadshows, where they’re engaging with investors even though they’re not going public.
Before the pandemic changed the world of business forever, these investor roadshows would be held in person. Now, most investor roadshows are either virtual or hybrid. In today’s blog, we’ll be discussing the effects of that shift, the advantages of virtual/hybrid roadshows for investor communications, and where the future of roadshows might go from here.
Investor communications: Virtual and hybrid roadshows
Since the pandemic drastically reduced the number of physical investor roadshows, many of the world’s most successful IPOs did just fine raising funds remotely. More than fine, really- even in the early days of the pandemic, companies were raising hundreds of millions of pounds from the comfort of their own homes.
This has led many to wonder whether the time, money, and overall effort expended on in-person investor roadshows was ever all that worth it, and whether companies will ever return to exclusively physical roadshows. IPOs around the world were undeterred by lockdowns. And while hosting a roadshow removes the possibility of face-to-face investor communications, there are a plethora of benefits to taking them online.
Advantages of virtual roadshows for investor communications
Virtual and hybrid roadshows have really changed the game for investor communications. It’s likely that, for a lot of companies, the days of exclusively in-person roadshows are over. Let’s take a look at why…
Saves on time and costs
When you consider just how much time, money, and energy needs to go into arranging an in-person investor roadshow, taking the event virtual seems like a no-brainer. It’s a very efficient way to interact with your current and prospective investors. You’re saving your own time, and you’re also saving your investors’ time, because they can tune in from anywhere in the world. There are also a litany of logistical issues when it comes to an event of this size, almost all of which are eliminated by taking things virtual.
You also have the opportunity to reach far more investors, because you’re not constrained by location, time, or costs. Your scope will be greatly increased, and you’ll also have far more time for meetings.
There are also a number of environmental benefits to consider. Before the pandemic, an in-person investor roadshow would have had large numbers of people travelling many, many miles. There’s also the carbon footprint involved in actually running the event. A roadshow going virtual won’t eliminate emissions entirely, but they’d undoubtedly be drastically lowered.
What’s next for investor roadshows?
There’s no denying that the pandemic has accelerated and ushered in a new age for investor roadshows. But while investor communications may never be the same, and companies are more than capable of raising funds remotely… people like doing business in the real world. At the end of the day, multiple years of constant virtual meetings has grown old rather quickly. So, in the next few years, investors may just be on the lookout for, if not exclusively virtual, then perhaps hybrid investor roadshows that allow them to actually talk business face-to-face.
Eager to learn more about the fundraising journey and investor communications? Keep an eye out for our next blog. And if you’re looking for an affordable virtual data room, head to our Engage page to find out more.