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Planning for the First 100 Days After Your IPO

Posted on July 9th, 2014. Posted by

You worked hard to prepare for your IPO and made it to the first day of trading. Celebrations are certainly in order, but there is plenty of work in the pipeline. In fact, operating as a newly public company presents a whole new set of challenges.

When it comes to investor relations, the focus of your first 100 days as a public company is to educate and communicate with investors and analysts — and to build on the momentum of the IPO to establish credibility, refine your messaging and vision, and provide the information that key stakeholders need. During this time period, your investor relations (IR) function should be in full swing with set procedures, policies, and designated spokespeople in place. In addition to delivering a well-crafted message, meeting with investors, and responding to analyst requests, we recommend that you create a strategic IR plan for the next 12 months and start preparing to report quarterly earnings for the first time.

Below, we share our view of some of the most important tasks during your first 100 days.

Refining the message
Being consistent with your company story and delivering on your promises are vital to establishing credibility with your stakeholders and ultimately expanding your shareholder base. Hopefully, during the IPO process your company has created a clear, well-defined message and vision and provided metrics to help investors track progress.

In the first three months after pricing your IPO, we suggest revisiting your investor presentation and updating it as necessary so that it clearly communicates your message, milestones, and goals. Your company message and story needs to be consistently delivered in investor meetings, conferences, and any communications you take part in as a public company.

Investor calls, meetings, and headquarter visits
Whether speaking to investors in person or on the phone, the designated spokesperson — typically the CFO, an IR specialist, or CEO — should stay on message and have a full understanding of Reg FD. In addition to a refreshed public-company investor deck, management should also be armed with talking points and an exhaustive list of potential questions (and scripted answers) when meeting with investors.

Quarterly earnings
Prepare for quarterly earnings by starting early and practicing. First, we recommend creating a process and timeline of deliverables. This means figuring out things like: when your financial results will be available; who from management should be involved in discussing the results, the implications of their involvement, and how this information will be translated into the quarterly press release; and your conference call script and Q&A preparation. As part of this process, we suggest creating a task grid with responsibilities and deadlines allocated — this avoids a last-minute scramble. Finally, in the messaging process, we always recommend revisiting previous messaging, guidance, and commentary, which need to be considered as you draft and refine the script, and preparing for potential analyst and investor questions.

When providing guidance for the first time, we suggest issuing a conservative and achievable guidance range instead of a point estimate, with the understanding that most investors and analysts expect a beat and raise cadence. Also expect to provide less detail on performance metrics as a public company. Ideally, you will have prepared your covering analysts for the metrics you plan to provide as a public company months before pricing your IPO.

After the call, follow up with analysts and key investors to see if there are any unanswered questions. And if possible, post the transcript on your IR website for the first few quarters, since it may not be available by more traditional means until you have become established as a publicly trading entity.

Investor relations strategic plan
Post-IPO, a newly public company should create an IR strategy for the next 12 months. While the goals and timeline won’t be set in stone, having a plan in place will give your company a framework to target new investors and a method to measure progress in expanding the shareholder base. Your plan should map out a calendar that includes investor conferences, non-deal road shows/bus tours, and a potential analyst day.

Companies typically can expect conference presentation invitations from the investment banks that were on the IPO. In addition, it’s also wise to develop a relationship with one or two additional sell-side banks. We suggest creating a list of targeted sell-side analysts and investors as you endeavor to broaden your shareholder base and attract additional research coverage over time. Benchmarks for identifying these targets should be relative to company peers of similar stage and growth, and assess relevance, geography, and investment strategy.

If you’re a newly public company, know that the first 100 days are critical to your long-term success. Need help figuring out the right approach and creating a solid IR plan for the months ahead? Download our Investor Relations Guide for more information.

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ICR Westwicke is the largest healthcare focused investor relations firm in the country. We provide customized investor relations programs and independent capital markets advice to small and mid-cap healthcare companies.

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