IR FAQs Investor Relations Questions, Answered

Investor relations (IR) is the function that manages communication between a public company and the investment community, including shareholders, prospective investors, sell-side analysts and brokers. IR combines finance and communications to explain a company’s strategy, results and outlook so the stock can be fairly valued. It covers earnings calls, investor presentations, one-on-one meetings, conferences, press releases and the IR website.

An investor relations firm helps public and pre-IPO companies tell their investment story and reach the right investors. Typical work includes building the IR strategy, writing earnings releases and call scripts, creating investor presentations, arranging meetings and non-deal roadshows, securing conference invitations and gathering investor feedback. Hayden IR provides these services to micro-, small- and mid-cap companies and facilitates more than 1,100 investor meetings a year for its clients.

Investor relations communicates with the financial community, such as shareholders, fund managers, analysts and brokers, about a company’s value as an investment. Public relations communicates with the media, customers and the general public about the company’s brand and reputation. IR requires financial analysis and close attention to securities disclosure rules, and its results show up in investor engagement, research coverage, liquidity and valuation.

Small- and micro-cap companies compete with thousands of other stocks for the attention of a limited pool of investors, and many have little or no research coverage. Without a proactive program, strong results can go unnoticed and the stock can trade at a discount to its peers. Effective investor relations builds the visibility, liquidity and shareholder base that support a fair valuation.

The terms group public companies by market capitalization, the total market value of their shares. Common ranges are roughly $50 million to $300 million for micro-caps, $300 million to $2 billion for small-caps and $2 billion to $10 billion for mid-caps, although definitions vary by index provider and fund. Companies below about $50 million are often called nano-caps.

IR firm fees vary with the scope of the program, the company’s size and stage, and how much writing, investor outreach and event work is involved. Most engagements are structured as a monthly retainer, and some firms also take part of their compensation in equity, such as restricted stock, options or warrants. Hayden IR scopes each program around the company’s goals before setting a fee.

Common triggers include a stock that trades at a discount to peers despite solid results, low trading volume or institutional ownership, little research coverage, an upcoming IPO, uplisting or capital raise, a major acquisition or a new management team. Companies without a full-time IR officer often hire a firm to run the function. Companies with an in-house IR director also bring in a firm to extend their reach, as 8x8 did with Hayden IR.

The average Hayden IR client engagement lasts more than two years, and many clients have stayed with the firm for more than a decade. American Software, for example, worked with Hayden IR for five years and later re-engaged the firm. Long relationships give the team a deep understanding of each business and its investors.

Yes. Hayden IR works with companies listed on North American and global exchanges. Its international clients have included Israeli companies Sapiens, AudioCodes and Perion, and Canada’s Enthusiast Gaming, which was listed on the Toronto Stock Exchange. The firm also formed the Hayden MS/IR joint venture to focus on European and Israeli companies listed or traded in the United States, and Managing Director Corbin Woodhull, who leads global advisory, previously headed international investor relations at a leading Latin American retail and eCommerce company.

No. A stock price depends on the company’s performance, its sector and market conditions, and no IR firm can promise a particular result. What a good firm can do is make sure the right investors understand the story, which gives the valuation a better chance of reflecting the company’s performance. Hayden IR’s long-standing motto is “No promises, just results.”

A non-deal roadshow (NDR) is a series of meetings between a public company’s management and current or prospective investors at a time when the company is not raising capital. Management typically spends a day or more in a city meeting funds one-on-one or in small groups to explain the investment story and answer questions. Because no stock is being sold, the meetings focus on building long-term relationships. Hayden IR has organized NDRs for clients in New York, Boston, Chicago, Minneapolis, Milwaukee, Dallas, San Francisco, Los Angeles and Seattle, as well as virtual roadshows.

Most small-cap investor conferences are hosted by sell-side firms or independent organizers, and invitations go to companies the hosts believe their investors will want to meet. An IR firm with strong relationships can introduce a company to conference organizers and the analysts who influence the invitation list. Hayden IR secures more than 110 conference invitations a year for its clients, at events hosted by firms including B. Riley, Roth, Craig-Hallum, Needham, Sidoti, Benchmark and LD Micro.

Sell-side analysts initiate coverage when they believe a stock will interest their firm’s clients, so the company needs a clear story, growing institutional interest and adequate trading liquidity. An IR firm can introduce management to analysts who cover the sector, keep them informed and build the investor following that makes coverage worthwhile. At Celsius Holdings, three analysts initiated research coverage with no banking transactions after Hayden IR introduced the company to more than 15 micro- and small-cap research firms and banks.

Buyers include small- and micro-cap mutual funds, hedge funds, family offices, independent portfolio managers, retail brokers and their clients, and accredited individual investors. Each group has different criteria for company size, liquidity and risk. Hayden IR typically starts with investors who can buy smaller, less liquid stocks and introduces larger institutions as the company grows, helping clients move up the Wall Street food chain.

A strong investor presentation opens with the investment thesis, then covers what the company does and the market it serves, its competitive advantages, the business model and key metrics, financial results and outlook, growth drivers and upcoming catalysts, the capital structure and the management team. It should be concise, lead with the metrics investors use to value the sector and turn dense tables into charts. Hayden IR edits client presentations for length, content and coherence.

Start a few weeks before the call by reviewing the results and the model, drafting the earnings release and script around the key messages, and listing likely analyst and investor questions with suggested answers. Management should rehearse the script and the Q&A together. After the call, follow up with top shareholders and analysts to answer questions and gather feedback.

Beyond required earnings and material event releases, a company should issue news when it has real progress to report, such as new customers, contracts, product launches, partnerships or milestones. Steady, meaningful news flow keeps investors informed between quarters, while a stream of minor releases can dilute attention. Hayden IR helps clients identify and draft non-earnings releases worth issuing, as it did for TSS.

Explain where the company is going, separate the growing business from the declining one in reporting and messaging, and give investors metrics to track progress. When 8x8 shifted away from a low-margin consumer offering toward a higher-margin SaaS business, Hayden IR devised communications strategies to define the transition and attract new investors and sell-side coverage. During the engagement, 8x8 gained coverage from firms including Deutsche Bank, Barclays, William Blair and Bank of America.

To uplist, a company must meet the exchange’s initial listing standards, which cover share price, stockholders’ equity or market value, public float, the number of shareholders and governance requirements such as an independent board and audit committee. Investor relations helps build the shareholder base, liquidity and valuation that support a listing. Hayden IR clients TSS and Issuer Direct uplisted to Nasdaq and to NYSE MKT, now NYSE American, and Celsius secured market maker sponsorship to gain Nasdaq uplisting support without raising money.

Prepare before it happens: know the shareholder base, keep strong relationships with major holders and address obvious weaknesses in strategy, governance or disclosure. When an activist or short seller goes public, respond quickly with facts, coordinate with legal counsel and the board, and speak directly with key shareholders and analysts. Hayden IR has advised clients through activist investors and short attacks, and Senior Managing Director Brian Siegel has deep experience counseling C-suites on activist shareholders.

A company with an engaged, well-informed investor base is in a stronger position to raise capital on good terms. Investor relations builds that base before a deal and supports the stock afterward. Processa Pharmaceuticals raised $10 million in a PIPE with no discount and no warrants during its Hayden IR engagement, and Enthusiast Gaming raised C$59 million at C$5.75 per share in February 2021, compared with C$30 million at C$1.50 per share in August 2020.

Companies that came public through a SPAC that traded poorly, or through a spin-off, often lack natural sponsors and trade at a discount. What helps is a clear investment thesis, metrics that show the real economics of the business and a fresh round of introductions to new investors. CuriosityStream, a former SPAC, and Zedge, a spin-off, both worked with Hayden IR to rebuild investor interest through targeted outreach and clearer messaging.

Explain the strategic logic, the financial impact and the timeline in the announcement, and hold a conference call so management can answer questions directly. Show investors how the deal changes growth, margins and the metrics they should track. Hayden IR has run planning sessions and scripted the call announcing a pivotal acquisition for Heska, and advised Enthusiast Gaming on its investor call about a transformational acquisition.