Validation Beyond the Financials

30 August 2007

Shifthappens_3The investment community is constantly looking for validation of a company’s go-forward strategy.  When I say validation I mean any kind of external (third party) evidence that validates what a company does and/or says.  Investors and analysts crave for external validation that helps answer questions such as:

  • Is the company going after the right vertical sector?
  • Are they going into the right geographies?
  • Do they have the right products/services to address consumer demand?
  • Is there really a growing market for what this company has to offer?
  • Is the addressable market actually shifting the way that the company says it is shifting?

An IR professional who consistently (and creatively) helps validate their company’s strategy in the minds of the investment community is a valued IR professional.  After all, IR is more than just balance sheets, income statements, and cash flow statements.

A friend of mine recently sent me a fascinating and enlightening presentation called Shift Happens.  It is largely unrelated to the capital markets or investing, however, the facts and figures presented are almost certain to educate anyone who watches it (remembering that financial analysts love data points).

Ask yourself the following question – would this presentation help validate anything my company is saying to the investment community?

Has your company ever talked about a strategy to go after the Asian market, about embracing the internet, about going digital, or about outsourcing to Asia?

Would any of the financial analysts or institutional shareholders who cover your company benefit from the information in this presentation?  If so, send it them.  And send other creative validation materials to them.  Chances are they will thank you.

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