Last Wednesday night the corporate communications practice at LEWIS held the first event in the new LEWIS San Francisco office – a roundtable discussion on communications and initial public offerings in the digital era. In light of the Facebook IPO and its aftermath, LEWIS client Splunk’s recent successful IPO and the Obama Administration’s Jobs Act aimed at making it easier for companies to go public, it was a timely topic. Yet, from several recent discussions with PR pros and executives from private companies, it’s also clear there’s still a lot of mystery and confusion around what companies thinking about or that are in the process of going public can and should do on the communications and digital media front.
We thus set out to address some of those questions and concerns, and assembled a phenomenal panel of experts on the subject:
- Ari Levy, a reporter at Bloomberg News who covers the tech industry and IPOs, provided the business media perspective
- Lisa Stimmell, a partner at Wilson Sonsini Goodrich & Rosati who has taken such companies as LinkedIn public, provided the legal perspective
- Paul Wilke, director of public relations at Splunk, which held its IPO in April, provided the perspective of a company that recently went through the process. Paul was also involved in the Visa IPO
- Morgan McLintic, EVP at LEWIS PR, moderated the discussion
There were three high-level takeaways from the session.
1. Take the long view
If you run a private company or run PR for a private company and there’s even a remote chance that you may consider going public in the next few years, you need to be building out your IPO communications and social media strategy now.
This may seem obvious, but all too often companies come to us either just as they’re about to file or once they have filed their S-1 asking how we can help them with their IPO. While there are certainly ways we can help, all the panelists agreed that this is less than optimal for three main reasons: 1.) companies are far more restricted in what they can say at that point, 2.) it leaves companies with little runway to develop and implement a fully developed, high impact strategy, and 3.) it allows no time to effectively propagate the company story out into the market through the media and social media (or to set the precedent of what is the normal level of marketing and PR activity).
2. Tell a story
Telling a compelling company story, well in advance of, leading up to and post IPO, is one of the most important factors in the success of an IPO. Very few companies will get the attention the Facebook IPO received as a result of the sheer size of the deal and prominence of Facebook. But any company can capture people’s imagination.
Media, investors, partners and potential employees are all drawn to companies with innovative products or business models, founded or run by interesting characters, or that have had a significant impact on society or overcame daunting challenges to get where they are today. Companies therefore need to identify, carefully craft and vigorously tell those stories long before they start the IPO process, and ensure all of their marketing and communications reinforce a strong and consistent corporate narrative. In an age of search engines and social media, this also provides a historical body of work from which reporters will pull from when writing about the company’s IPO, filling in the blanks at a time when the company is unable to provide comment due to the quiet period.
3. Get everyone on the same page
Most companies going through an IPO understand that investor relations, legal, marketing and PR all need to coordinate closely. But that’s not enough. These teams need to be completely aligned. In particular, marketing and PR need to be ingrained in the process of developing the corporate story that is then communicated through the prospectus, the roadshow presentation, etc. Close integration of legal and market is also crucial. If the legal team fully understand what marketing is trying to achieve, it is more likely to be able to help find ways to achieve it, rather than simple say no to things they can’t do from a legal perspective.
More often, the PR team is off developing story ideas to pitch the media, while finance / investor relations is off preparing the investor presentation and S-1, and legal is looking over everyone’s shoulders for potential legal issues. And if you look at many online roadshow presentations and S-1’s, it shows. These are critical communications vehicles during the IPO process and they need tell the broader corporate narrative (per the previous point) in a compelling way while also reflecting the investor messages.
All in all, it was a fascinating conversation. The panelists provided many valuable insights and practical information and ideas, and the audience had great questions and gave very positive feedback.
This was the first in a series of events LEWIS will be holding on the changing face of communications. Stay tuned for more to come.