Archive for the ‘Uncategorized’ Category

 

The following is a modified article that I wrote for, and was featured in, Resource World Magazine. For magazine enquiries please visit : http://www.resourceworld.com/ 

 

 

Conference Season

 

Conference season is now upon us and resource companies are investing time, energy and precious cash to meet with current and potential investors. Most companies will send available senior management to the premier investment conferences, but don’t expect them to be hanging around their tradeshow booth for the entire show. Many will be giving presentations, holding private meetings attending industry events and networking. Most will spend a limited amount of time each day at their booth, leaving the hard lifting to the investor relations team. If you are fortunate enough to catch the CEO, President or Geologist, ask them the burning questions you have about their company, but also make sure you take the time to say hello to the Investor Relations Officer, or IRO. This is the individual you will want to build a relationship with because, after the show is over, unless you are a major shareholder, it’s the IRO that responds to the majority of investor inquiries. 

 

Be Prepared

 

If you are going to attend an investment conference, make sure you are well prepared for the lengthy walks, line ups, cafeteria food, huge crowds, and complete sensory overload. I recommend spending time to read the speaker schedule, the map of the investors’ exchange and the schedule of networking and ticketed events. Scan the list of companies attending the conference, review the floor map and highlight the companies you want to meet with and make sure you take notes, you will be glad you did. I find that without a solid game plan I can walk in circles all day and may miss the speakers and the company’s booth I had planned to visit. 

 

Face to Face with the IRO, what now?

 

Once you have navigated your way into the investor’s exchange, and are face to face with an IRO, what should you ask? When I am in the IRO role, I like when people introduce themselves to me and let me know their interest in the company. Are you a current shareholder or a potential investor? Do you know much about the company, or are you just curious about the project/operation, management or region in which we have our assets? Once the conversation is flowing, ask the questions you have prepared. Good IROs will be able to answer questions on a variety of topics so I urge you to find out as much as you can about each company you have an interest in.

 

When I look at a company as an investment or as a potential client for Steel Rose Communications here’s where I start: 

 

Who is on the management team? 

 

Who are the key players? What recent successes have they had? Are they respectable or do they have a coloured past? Have their successes been in areas of the current project? How many other companies are they running? How many shares do they own in the company? Are they compensated fairly? 

 

What is the share structure? 

 

How many shares are outstanding and does this match with the level of development of the company? How many warrants and options are outstanding and at what price? What types of shares are outstanding?

 

How is the stock doing? 

 

What exchange does it trade on? Does it have good liquidity or does it trade by appointment? What kind of trading volume is there? Is the share price at a 52-week high or low? What is the trend for the past few years and the reasons why (i.e. if it is at a low is it due to macro/micro factors)? Where is the stock price going? (trick question – If they tell you it’s going up quickly and to buy in now, it’s time to run.)

 

What is the financial picture? 

 

How much money does the company have? Will they need to finance again soon and will they be able to raise funds? What’s their monthly burn rate and how much debt are they carrying?

 

Who are the shareholders? 

 

Who are their major shareholders? Are there any key industry players? Has the company attracted any legitimate mining analysts, brokers or institutions? Are any of the management key shareholders? What percent of the shares does management hold?

 

What are the IR plans? 

 

Does the company have a good IR team in place? How do they plan to market the company this year? What are the key expenses that drive the budget? What have they done in the past that has been successful? What are they trying for the first time? 

 

How do you communicate with shareholders? 

 

What communications plans are in place to reach stakeholders? Are they active in social media? Do they have a strong website? Do they have site visits or investor days? Do they respond to phone calls in a timely fashion? Do they produce marketing materials and can they be found online? 

 

 

TELL ME ABOUT THE PROJECT/OPERATION

 

What is the commodity? 

 

(Precious metals, base metals, diamonds, specialty metals, industrial metals) Is the commodity selling at favourable price? What is the forecast for this sector? Is this commodity the flavour of the month? Lithium, Graphite, what is it this year?

 

Where is the project? 

 

Are they local? Are they in a war zone or a politically stable country? Are they in an area play? Are they in a mining friendly jurisdiction? Are they close to any national parks or is there a risk one might be declared on their project? (This actually happened to one of my previous clients.)

 

What stage is the project? 

 

Grassroots, exploration, development or production? What work has been done on the project? How much has the company spent, what have they done? How much is left to spend to get it into production? Is there a reserve or resource estimate, or a scoping study, pre-feasibility study, bankable feasibility study? What’s the tonnage and grade like? Can they tell me about recent drill results? 

How is your operation doing? What is the mine life? How is production trending, tonnage, and grade? Do they see expansion potential? What is their planned capex? What do they expect to see for cash costs, drivers behind any increases or decreases? What challenges do they see to meet their production targets?

 

Is there infrastructure? 

 

Are there roads, power, rail, electricity, labour, water, exploration camp? Is there a community close by? 

 

What are other potential issues? 

 

Are there archeological or environmental challenges or negative relationships with First Nation communities due to previous mining activities?

 

Is this a potential area play? 

 

Is this project near a current producing mine, near a recent discovery? Can they leverage the resources such as management, or infrastructure if it is near a current mine? Located near a major mining camp or mineral trend? Was this a past producing mine?

After exhausting the IRO with extensive questioning, I like to thank them for their time. If I find the IRO has been knowledgeable and helpful, I leave a business card and let them know I will be following up at a later time. If the IRO is a novice and can’t answer all of my questions, I try to pick up a business card of one of the senior executives and let them know they could have prepared their IRO better.

If you are selling something or looking for a job, do the IRO a favour and let them know up front. Don’t pretend to be interested in the company just so you can give your pitch. Conferences are an important part of the marketing mix that require a great deal of time, energy and financial resources. Understand this, respect this and you will be on track to develop a strong rapport with each IRO that you meet. 

 

Jon Bey is the President /CEO of Steel Rose Communications in Vancouver, B.C. SRC is a boutique IR firm that specializes in Investor Relations services for publically listed Jr. Resource companies. Jon is a Board member of the BC Chapter of CIRI and is Professionally Certified in Investor Relations. Information on SRC can be found on their website at www.steelrosecommunications.com

 

We have more good stuff on our blog, take a peek here. And, come on over and say hi on Twitter : @SteelRoseComm . You should also check out Resource World Magazine on Twitter : @ResourceWorld.

Thanks for reading, hope it was helpful! Want to know more about what makes a great IRO? Feel free to contact me.

:-)

Jon Bey

 

Get to KNOW YOUR IRO – Investor Relations

January 31st, 2013 by Jon Bey

 

The following is a modified article that I wrote for, and was featured in, Canadian Investor Magazine (V2I1). For magazine enquiries please visit www.canadianinvestor.com :

So what do you do?

““So what do you do?” That’s usually the second question I am asked by most border guards and custom agents. My reply is often, “Investor Relations,” which always leads to a blank stare. In this profession, travel is almost always a requirement, and it can be a blessing and a curse. I love to travel, but those awkward custom agent conversations wear me down.

I don’t blame the agents; I am still trying to explain to my wife exactly what it is I do. So the issue must be with my profession or my explanation. Unfortunately, the Investor Relations profession is still not well understood. So let me try to explain what (IROs) Investor Relations Officers actually do. If you understand their role in the company, it may make it easier for you to engage with them, and dig a bit deeper into your current or next potential investment.

 

What do we do? 

Simply put, our job is to explain our company to the investment world. But it’s usually not that simple. Most companies are extremely complex, so the explanations tend to be that way as well. Our audience is quite diverse; so we need to craft a slightly different message for each type of investor. That means telling our company story in a way that is meaningful to each one, providing the key information they are looking for. We speak to retail investors, institutional investors, analysts, sophisticated high net worth investors, stock brokers, fund managers and various stakeholders in the company. IROs are also the gatekeepers to the senior executives. CEOs and CFOs do not have time to speak to every investor that calls the company with questions. The IRO handles all incoming calls leaving the senior executives to run the company.

Like many investors, I am a fan of Warren Buffet. He has a special way of explaining complex scenarios that both novice and sophisticated investors can understand. He likes to pretend he is speaking to his two sisters. I like that, but I twist it a bit and pretend I am speaking to my uncle the customs agent. I need to be able to explain my story to him quickly and clearly so he can understand it and then send me on my way. I also don’t want to provide any false or misleading information which might get me locked up.

 

How do we do it?

Although communication methods have changed in recent times with the rise of social media, the heart and soul of a great IRO is still their ability to interact and converse with investors. Great IROs have the ability to engage with their audience face to face or on the phone. But, the reality is, most public companies have hundreds or thousands of shareholders and speaking personally to each one of them is a daunting task. So how do most IROs communicate with the investment community? Most communication now happens online – at least to start anyway.

IROs invest a great deal of time in the corporate website. All material corporate information must be located there and should be easy for investors to find. It must also remain current at all times to stay in compliance with security regulations. A seasoned IRO will know their company website inside and out and will be able to speak to each section in depth and provide colour to areas that may be filled with technical and industry jargon that may be confusing to the average investor. All corporate websites will have a “contact us” page and the IRO contact details will be provided there. Send the IRO an email with your specific question, or simply give them a call.

The communications world is rapidly changing, and social media is the main driver pushing these changes. In the past three to four years, I have seen early adopters in the public-company space, experiment with new technology that is enhancing investor communication possibilities. Public companies are using Facebook, LinkedIn, Slide Share, Twitter, blogs, Google Earth interactive platforms, Flickr and various other social networks to spread their company news and engage with their audience. The security regulators are trying to keep up to ensure disclosure policies are not being violated but it is an endless battle. The rules will need to change. Watch for companies to start disclosing material information in ways other than the traditional news wires.

 

What skills does a seasoned IRO possess?

Like any profession, IROs come in all sizes and shapes. There are no set standards or requirements to enter this career so there can be a huge variance in the skill sets between IROs. The Canadian Investor Relations Institute (CIRI) works hard to provide educational courses and, a professional certification with the IVEY school of Business, for advanced IROs. But the reality is, it’s a real mixed bag. Seasoned IROs will possess skills in finance, marketing, communications and securities law. The majority of IROs enter the profession with some of those skills and learn the rest on the job. Your IRO should be knowledgeable about the industry their company is in. They should know how the company is valued, they should be able to compare the company to its peers and they should be able to explain the company’s business drivers and how there company will drive shareholder value.

The great IROs are said to be a hybrid of a CEO and CFO. They can speak to the big picture of the company and also break down the financials to a granular level.

 

How should the IRO be able to help you?

Your IRO should be able to help you understand the company and explain all the technical, financial and industry jargon in everyday language. They should be able to answer your phone calls and emails in a timely fashion and guide you through the corporate website and help you locate any information you need. Good IROs can help you navigate your way through the traditional mailing materials you may receive like the Information Circulars, MD&A and Financial documents.

But don’t ask them to provide any insider information. They shouldn’t be providing any information to you that has not already be released to the market through proper disclosure policies. And they shouldn’t be telling you to buy the company stock. If they do, it’s time to sell.

 

Get to know your IRO

The IRO can be a great resource for any investor and I urge you to get to know the IROs of all the companies you invest in. If the company happens to be presenting in your community or showcasing themselves at an investment conference, take the time to the visit them and meet the IRO and the other senior executives.

I guess I am hopeful that one day, in my lifetime, a customs agent will ask my profession and then give me a knowing look and send me on my way. But, until that day comes, I’ll just smile, keep my story simple and be thankful that I have my Nexus card.

 

Jon Bey is the President /CEO of Steel Rose Communications in Vancouver, B.C. SRC is a boutique IR firm that specializes in Investor Relations services for publically listed Jr. Resource companies. Jon is a Board member of the BC Chapter of CIRI and is Professionally Certified in Investor Relations. Information on SRC can be found on their website at www.steelrosecommunications.com

 

Like what you’ve read? I will be writing more articles for a few publications in the coming months, so look out for those :-)

In the meantime, we have more good stuff on our blog, take a peek here. And, come on over and say hi on Twitter : @SteelRoseComm . You should also check out Canadian Investor Magazine on Twitter : @CanInvestorMag.

Thanks for reading, hope you enjoyed it!

:-)

Jon Bey

 

 

Happy Halloween everyone! At this time of year, with the ghouls and goblins on the prowl, I thought I would point out the Top 6 Scariest Investor Relations Practices I see on a regular basis.  As an investor, when I begin to research a company, I have a process I go through when vetting all potential deals. When it comes to the Investor Relations component, I am still shocked at how many companies make horrifying mistakes. Here are the Investor Relations Practices that scare me away from a potential investment:

6. The Shadowy, Uneducated IR Professional

It still shocks me that there are individuals representing companies in an IR role that have no idea of what they are doing. Don’t get me wrong, I know everyone starts out ‘green’, and most people learn on the job, but I encounter some individuals that have been in the industry for a few years, and have yet to make the effort to educate themselves. Time to take a course, read a book, and join your local NIRI or CIRI chapter.

5. Ghastly Websites

The corporate website is the most important marketing piece a company controls, but yet I still see alarming websites every week. I shake my head, and move my attention to the next company immediately. If a company still does not understand how valuable their website can be, and the damage it can cause if it is outdated, then they don’t deserve my time or money.

4. Hair-raising, Over-Promotional IR Types

When I talk to a CEO, or an IRO, I fully expect to see their passion, and hear how great their project is. What turns me off a project is when the IRO goes beyond the investment opportunity and turns into the wicked, used car salesman. Give me the facts, save the hard sell, and don’t tell me if I don’t get in on the deal today, I will miss the stock jump coming this week.

3. Haunted Social Media Deniers

Social Media and Social Networking is growing rapidly, and I hope to see the companies I am looking at least taking steps to monitor what is being said about their company. If the senior executives are burying their heads and ignoring the potential opportunity, I question their commitment to Investor Relations. If the IROs are doing this as well, then I move on to the next deal. The IRO may be having trouble convincing the C-Suite, but they need to be trying, and there are several things they could be doing on their own with little time commitment, and for little money.

2. Vampiric Social Media Companies

On the other hand, things get really creepy when I see a Social Media Company running a campaign for a public company that has no understanding of security commission regulations, or exchange rules. If you are going to hire an outside firm to help you with your Social Media campaign, and there are a lot of good ones, make sure they understand your company, industry, and the proper rules of your stock exchange. The last thing your company needs is to get flagged by the regulators for being perilous with your tweets, and comments made in the social media space.

1. Ghostlike, No Investor Relations at All

Yes it is true; there are still public companies that don’t understand the value that an educated Investor Relations professional can bring to their company. Some tell me the IR is handled by the CFO or another executive, and others don’t believe the value add is worth the expense. Some have had a bad experience with a poor IRO, and don’t know where to find a qualified professional. I always advise them to give it another shot, and to search for a qualified IRO through their local CIRI or NIRI branch. CIRI has just graduated their first class of Professionally Certified Investor Relations Professionals through the IVEY School of Business, take a look here for a qualified professional.

I wish you a spooky Halloween wherever you may be, and please add to our list, What IR Practices Horrify You?

 

All the best,

Jon

How to Succeed at Investor Conferences

February 28th, 2012 by Jon Bey

I received a call the other day from an individual new to Investor Relations. She had just been hired by a junior exploration company in Vancouver and was asked to represent her company at the upcoming PDAC mining conference in Toronto. This will be her first experience as an Investor Relations professional representing a company, and it just happens to be at the largest mining convention in the world. Now what?

Depending on whom you ask, these investor conferences can be of great benefit or a complete waste of resources. I believe they can be both. If you prepare properly and follow a game plan, these conferences can be extremely valuable. But, if you show up unprepared, it may be a fun experience but a complete waste of corporate funds and time.

I caught up with Bear Creek Mining’s Lisa May, an experienced IR professional, currently completing her professional Certification in Investor Relations from CIRI and the IVEY school of Business. We discussed investor conferences and came up with these four areas which are critical to the success of Investor Relations professionals.

4 pillars of a successful Investors Conference plan

There are four pillars to a successful investor conference plan. If you follow all four, you will have success and will have created value for your company. Miss any of these crucial pillars, and your conference might have been a waste of time and money.

1. Identifying the right conferences
2. Preparing for the conference
3. Executing the conference plan
4. Conference follow up – measurement of success

Identifying the right conferences for your company

First, you must understand your own company. You will need to figure out the basic facts about your company before you can figure out which conferences to attend. Next, find out from Sr. management what the corporate strategy is and why they want you to attend the conferences. Finally, use your detective skills to search for all potential industry specific conferences. Once you know these answers, it should be easy to identify the right conferences to attend.

• What industry are you in? (no brainer)
• Why does your company want to you attend the conferences? What is the strategy?
• What stage is your company in? (grass roots exploration, advanced exploration, mining)
• What’s your market cap size? (micro-cap, small cap, mid cap, large cap)
• Who are your company’s peers? (companies similar to yours)
• What conferences do your peers attend? – which ones do they recommend?
• What is your company willing to spend to attend the conferences? Some are expensive!
• Where does your management want to gain traction? – find investors, analysts, fund managers, brokers etc. (local, Canada, USA, Europe, Asia)
• Search online – maybe there are new conferences this year.
• Search through your social networks – ask what conferences to attend on Twitter, Linkedin, and Facebook.

Preparing for the conference

Now that you have identified a few conferences that look intriguing, the next steps are to get registered for the conference and start the process of preparation. The registration is the easy part as long as the conference is open to all. You may find the conference you want to attend is by invitation only and your company may not meet the criteria this year. Once you have registered, the real work begins. The preparation stage is by far the most important.

• Identify the company goals for the conference. Why are you attending? (To gain retail investors, meet institutional investors, business development, or networking)
• Book all the conference extras (tables, chairs, carpet, insurance etc.)
• Book travel for you and your conference materials. (you may send your booth early)
• Do you have a conference booth? Is it current? Do you have a graphic designer to provide current material for the banners? Is your booth functional? How do you set it up, Test it out. Make sure you do a dry run in your office!
• Prepare the marketing materials: fact sheets, corporate presentations etc.
• Locate a local printer near the conference in case more materials are needed.
• Plan your schedule around the conference – what other events, meetings can you arrange for your management team?
• Invite investors, brokers, shareholders to visit you at the booth – by email and through social networks like: Facebook, Twitter and LinkedIn.
• Prepare your strategy and game plan for your days at the booth. How will you engage investors? How will you track your conversations?
• Prepare a list of frequently asked questions you will likely be asked at your booth and rehearse your answers
• Add the conference to the Calendar section of your company website – maybe highlight the conference on the homepage.
• Prepare a strategy to measure your success at the show – did you accomplish your goals?

Show time – During the conference

You have managed to get this far; now it is time to perform. I strongly recommend you arrive at least one day early and make use of the early set-up time for your booth. Sometimes they break or have issues that you will want to solve before the morning of the show. Once the doors open and the investors start to roll in, you need to be on your game. Try to have more than a few hours of sleep; this can be difficult at times. Here are a few tips once the investors start to walk the aisles.

• Don’t get worried if many investors don’t want to speak to you, each investor has different agendas and specific companies and sectors they follow.
• Start with a smile and a nice greeting to those that stop by your booth.
• Define roles of those in the booth. Are you manning the booth alone, or with the company CEO?
• Have a few good opening questions like: Have you heard of our company? Are you interested in copper? If that is your speciality, can I answer any questions for you?
• Don’t act like a used car salesman.
• Engage your audience; find out if they are a current shareholder, what kind of investor they are, how they hear heard about your company?
• Create an opportunity for follow-up.
• Create a spreadsheet and record details of the good meetings you had, and try to collect a business card or contact details.
• Tweet about the conference while it is occurring, inviting people to your booth to meet you.
• Try to attend any Tweet-ups you have been invited to – maybe create your own.
• Add the conference information to your corporate Facebook page and add daily updates and pictures of the events.
• Try to get some video footage of your CEO or management at the conference.
• Try to arrange some media coverage (perhaps an interview for your Sr. management).

Follow up and measurement of success – Was the conference a good return on investment?

Once the tradeshow is over and you have packed up the booth and sent it on its way, it will be time for a cold drink and a quick reflection on the success of the event. You may want to wait until you return home, but don’t procrastinate: do these before you move on to your next task and while your memories are fresh. Here’s what I do:

• Review your spreadsheet and compare it to your original goals – did you meet the number of retail and institutional brokers you had hoped?
• Did you meet your networking goals?
• Did you manage to arrange any business development meetings?
• Did you meet the shareholders that you invited to the booth?
• Were your social media and social network activities a success?
• Review your pre-conference checklist – did all go as planned? What changes would you make?
• Were you happy with the travel arrangements? Was the hotel acceptable?
• What events, activities did you not know about that you want to include for next year?
• Plan your follow-up with all the individuals you met with.
• Update your list of frequently asked questions.
• Create a document that you can share with Sr. management and the board showing them the company’s success at the conference and a plan to improve next year’s event.
• Plan your meeting with your CEO to review your compensation – you are surely due for a raise!

We hope this has been a helpful tool. Please contact us should you have any questions or would like assistance with any of your Corporate Investor Relations needs: Twitter, LinkedIn, Facebook. Talk soon, see you at the next Investors Conference!

Jon Bey – Steel Rose Communications

 

In another post, we discussed the WHY of Social Media, mainly citing that ‘your customers are having a conversation without you’, and therefore, you should be joining in on that conversation, somehow. And, there’s more than one way to utilize all that is Social Media.

WHAT am I doing here?

You can generally break your social media activities into 4 main categories:

Monitoring :

What is being said about your brand? What are your competitors doing? What content are they creating? Who do they follow? Are they any good at ‘this social media thing’? Can you see ways to differentiate yourself from them? Keep up on the latest research or trends, find opportunities, get inspiration for your own blogging/writing.

Communication/Storytelling :

Establish your profile, raise awareness of your brand, engage followers, perhaps reach out to other content creators. Build interest in your content.

Connecting : 

Build relationships with industry peers, potential investors, influencers and the public. Find researchers and experts in your field. Connect to executives. Build trust with and among industry peers. Help media, and collaborators find you.

Collaborate :

Work and collaborate more effectively. Create/join groups, choose tools and tags that relate to your industry, support your professional development.

 

Approach

Maybe you utilize one, or maybe you utilize all of the above categories. Perhaps you use Twitter for Monitoring, Facebook for Connecting, and/or a blog for Communicating. Why didn’t he mention StockTwits? … Generally, how you approach social media, what tools you should use, depends on your goals, assets, and audience. There are many unique examples of internal and external uses of social media.

 

How are other companies using social media?

a) Internal social media use example: Deloitte using Yammer.com, The Enterprise Social Network

“Steve Jobs once said, ‘innovation comes from people meeting up in the hallways or calling each other at 10:30 at night with a new idea.’ Deloitte is a massive global organization with hundreds of offices, but now, we all have one, common ‘hallway’ called Yammer, and it is always 10:30PM.”

— US & Global Managing Director of Technology Innovation, Deloitte LLP

 

b) External social media use example: How Provident Security uses their blog

“Use social media for Customer service”. “We don’t sell online”. “Acts as an internal reference for out team”.

– Mike Jagger, Provident Security

 

What’s with the tangent?

Now, we are a Investor Relations and Corporate Communications firm, yet neither one of the above examples has anything directly to do with ‘selling’ anything, marketing, lead generation, ROI, etc. The point is, social media is much more multi-faceted than just straight marketing. The above examples are meant to get you to take a creative look at how social media can help your objectives, and how your company can potentially further integrate social media.

Again, how you and your company will use social media, what you will do with it, depends on what your goals are.

 

WHAT is stopping you?

So, with all the potential of Social Media, what is the one thing stopping CEOs from jumping on board? … more on this very soon.

 

How do make use of social media?

Do you have any unique examples of you or your company make use of social media?

Tell us about them in the comments section below, Twitter, and/or Facebook.

 

Social Media SOS?

Still need help defining your social media goals and objectives? Still don’t get how social media applies to you? Just don’t know where to start? We are here for you. Let us know your questions. Reach us at @steelrosecomm, find us on Facebook, LinkedIn, leave a comment below, or even email us.

 

Talk soon …