What is a Non Deal Roadshow?
Strong relationships with investors usually lead to more profitable investments. The big question is, how can these relationships be established and nurtured? While it’s important to keep reaching out to a wider audience, it’s also essential not to forget your existing investors, and to keep them up-to-date on their shares and your company’s recent activity.
One way to achieve this is to get on the road with a non deal roadshow. If you’re not sure what that is, here’s more information.
What is a Non Deal Roadshow, Exactly?
The SEC (Securities and Exchange Commission) defines a roadshow as an offer that contains a presentation, which is made by the issuer’s management. This should include a discussion of the issuer in question, plus details about the securities or administration being offered.
In simpler terms, it’s a way to demonstrate your current offerings to anyone thinking of investing. However, with a non deal roadshow (NDR) there is a key difference. At an NDR, your company can discuss investments with both current and prospective investors, only this time, nothing is offered for sale. Its primary focus is to:
• Provide useful information
• Explain your company’s vision for the future
• Update investors on how your company is performing
What are the Benefits?
While you may question the advantages of undertaking an NDR (given that nothing will be sold), we believe it should form an integral part of your investor outreach strategy. An NDR offers the chance to:
• Strengthen relations. Investors don’t like to be kept in the dark. They want to know how the company has been performing, as this has a direct impact on their investment. An NDR provides reassurance and builds trust.
• Build understanding. It’s important to remember that not all investors understand your company’s practices as well as you do. An informative presentation can fill in any gaps in their understanding. It also gives your team the opportunity to understand why the investor has chosen to own shares in your company, and what they expect to gain from it.
• Establish expectations. Managing investor expectations can be tricky. An NDR gives you the chance to set proper expectations in terms of evaluating your company’s performance.
• Encourage more investment. Existing investors gain a better grasp of the results of owning a larger share of the company. Likewise, new attendees are more likely to invest in the future if they’re fully convinced by the information you provide.
• Hear from the investors. An NDR isn’t a one-way conversation. It’s an invaluable chance to talk to investors and hear their thoughts on your competition, the areas they’re most (and least) interested in regarding your operations, and whether they’d be interested to provide funds for future financing. This information can be used to enhance your investment strategy.
• Improve relationships with others. In addition to building relations with investors, an NDR is the ideal time to boost relationships with sell-side analysts, retail brokers, portfolio experts, fund managers and more.
How to Have a Successful Non Deal Roadshow
Firstly, recognize it as a major event and plan accordingly. We recommend that you start preparing months in advance. It’s also vital to establish your goals right from the start. What outcomes do you want to achieve? Is it to build awareness of your company, or to raise trading volume in the shares? Gaining a solid idea of what you want to gain from the process will help you to tailor your planning more effectively.
You’ll also need to undertake some research. Which investors are you going to target and where are they located? This will help to determine which cities to visit during your NDR. Timing is also crucial. For example, we strongly advise our clients not to arrange roadshows that coincide with other major investor events or medical conferences.
Before the NDR
Closer to the date, make sure you have access to each investor’s AUM, investment strategy and Holdings, prior to meeting them in person. Investors expect you to be well prepared and primed to answer any questions that you might have, so it’s important to make sure this is the case.
Identify what sort of information you’d like to glean from your attendees too, as this can guide future marketing events/strategies.
What is a Non Deal Roadshow? A Chance to Reap Big Rewards
NDRs are fast-paced and labor-intensive, but they’re incredibly rewarding. Although technological advancements have empowered businesses, they can’t replace face-to-face interaction, nor can they compete in terms of developing relationships and gaining insight.
If you’d like to learn more about NDRs and how to enhance your investor outreach, LifeSci Advisors can help. You can learn more about our services here.