For scaling tech companies, the shift from being privately-owned to publicly listed is a real exercise in public communication, almost as much as it is a practical process of documentation, legal consideration and operational and structural changes.
During London Tech Week this year, our Director of Communications & Government Relations, Emma Thompson, had the pleasure of taking part in Finsbury Glover Hering’s virtual panel on the role of communications as tech companies prepare to IPO.
Emma was joined by Stefan Gaiser, CFO of TeamViewer, Philipp Freise, Co-Head of Europe Private Equity at KKR, Paul Klemm, Principal at EarlyBird, and Daniel Schäfer, Partner at Finsbury Glover Hering; a group of experts whose experience ranges from navigating their own companies through the listing journey, to reporting on tech IPOs as a former Bloomberg journalist. The event was moderated by experienced tech leader Sophie Scott; Partner and Global Technology Lead at Finsbury Glover Hering.
Here are five of our key takeaways from the fascinating discussion:
- Prepare your IPO comms strategy well in advance
Throughout the event, every panelist highlighted the importance of preparing your IPO comms strategy years in advance. The group agreed unanimously that tech companies should be investing in IPO comms at least two to three years before the float, as the key to achieving the success of publicly listed companies like Trainline or The Hut Group – both of which IPOed in London – is to thoroughly plan ahead.
In the early days, companies’ management teams should focus on what it is they’re trying to achieve, develop a truly compelling and values-based brand narrative (more on this later), and begin mentally preparing themselves for the new level of scrutiny that their listing will bring.
The team agreed that media training is one helpful way to approach this challenge, and recommended training key spokespeople up to 2 years before your IPO, and again right before listing.
Finally, the experts emphasised the importance of establishing key contacts within the press at an early stage. Ideally one to two years before listing, start educating key journalists about your company in order to establish trust and shape your narrative from the start.
In summary, don’t leave your comms to the last minute! Investing in your comms team and strategy in the years leading up to your IPO will make it easier to win hearts and minds in the longer term.
- Create a compelling brand story
As we just touched upon, one crucial way to ensure your company is portrayed in the best possible light is to craft a compelling company narrative. To get your comms right on the path to IPO, you need to be able to confidently tell the world who you are, what you plan to do with your money and what your future looks like.
During the panel, Emma outlined how tech companies should focus on building their brand and their presence, systematically and diligently over time. It will likely take years to perfect your story, gather your facts and figures, and start creating your own repository of illuminating blogs, case studies and content – but this will all be invaluable later down the line.
In particular, all of the panelists recommended crafting a concise, compelling one-pager on your narrative and story to ensure that all stakeholders – including media – are hearing a consistent message about the business, the addressable market and the equity story. At the centrepiece of this one-pager, you need a USP explaining why your company is more interesting than other firms in the sector.
If this summary is kept jargon-free and easy for journalists to understand, it can be a very powerful tool in helping to shape your narrative. After all, as Emma pointed out, it’s no accident that VC investors are employing Hollywood scriptwriters to tell the stories of the companies they’re invested in!
Keep in mind that once you’ve got this narrative in place, it will be hard to unpick or reverse. That’s why upfront investment in your company’s comms is so valuable and worthwhile.
- Your employees should be your biggest advocates
Remembering the importance of employees as your most critical audience will go a long way to turning your team into advocates and help attract future talent as you grow – which is critical to the success of any organization competing for tech talent today.
In turn, having staff as your advocates helps you amplify your company’s message to your audiences. However, they’re not going to do that unless it feels real. Comms only amplifies that wonderful kernel that you need to get right in the first place – and the better your business plan, the better your comms will be. In Emma’s words, “staff want to work for a company that makes them feel good and that’s doing good.”
Stefan also talked from his own experience about the importance of team spirit and morale in boosting employee advocacy and having a successful IPO. In the run up to listing, Stefan’s employees were immensely proud of the process, largely as a result of their weekly company-wide meetings and regular team socials. The success of their listing, said Stefan, was a real testament to the phenomenal team spirit his company had during the years, months and weeks leading up to IPO.
- ESG ratings really matter
ESG (Environmental, Social, and Corporate Governance) ratings are an evaluation of a firm’s collective conscientiousness for social and environmental factors, and are used by socially conscious investors to screen potential investments. This means that not only is it important to have strong company values for strengthening your comms to attract and retain the best talent; it’s also hugely important that you communicate these values to be successful during and after your IPO.
The panelists agreed that the impact and importance of ESG ratings have changed a lot over the last decade, and it’s no longer optional for tech companies looking to list not not to have a clear concept of their ESG agenda. As Emma emphasised, tech companies must link their mission, vision and values to the major social and environmental trends of today – and then use comms to amplify this make-or-break messaging.
Speaking from his own experience, Paul said that “all of us here on the global tech scene know Earth is a planet with limited resources, and our climate crisis needs to be resolved within the next 5-10 years in order to make living on it worthwhile. This type of thinking and prioritisation is something we seek in the mindsets of the companies we partner with – and actions always speak louder than words.”
- The day you list is not the end of the marathon – it’s the halfway point!
Growth is not just a short term but a long term phenomenon, so it’s vital that tech companies preparing to list have a long-term business plan and keep investing in it. Thinking through the regulatory environment and where and how to adapt will ensure long term viability.
The panelists cited examples of the growth that can happen after listing; Darktrace has tripled its valuation since Iisting on the LSE earlier this year, and The Hut Group has also tripled its growth as a global ecommerce platform since IPOing in London.
Companies and management teams must be prepared for the media scrutiny that follows the IPO, and keep their focus on balancing the narrative and reiterating their mission statements. Consistency is key to successful comms, and the team highlighted the importance of media training in ensuring that management teams are aligned and ready for the amount of attention they’re going to face after listing.
Essentially, as any tech company that’s just gone public will know, the IPO is only the start of the beginning. Using your compelling story, values and mission statement crafted in the years leading up to your IPO, shift your focus to staying consistent, committed, and – above all – confident in what you’re communicating.
Find out more
To find out more about IPOing in London, check out our ‘Start Here, Scale Here, Stay Here’ Report about the benefits of building and growing a tech scaleup in the UK.
We also recommend you check out this recent podcast on ‘What’s driving IPOs in London?’ from the London Stock Exchange, hosted by our Chair, Stephen Kelly.