M&A Outcomes

Finding a PR Firm with Experience Relevant to You

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One of the first questions everyone asks a potential PR agency is, “do you have experience in (my industry)?” Hiring a PR firm with experience relevant to you is a multifaceted process, and fundamentally, it’s one no one really enjoys. Part of the reason no one enjoys it is every PR agency is slightly different, and it can be hard to determine which is most valuable to your company. But engaging with a PR firm based on their experience is really like letting the tail wag the dog. The question you really want to ask is, “What’s your experience with companies with the same business goals?“. This is especially true in emerging industries and nascent markets. What’s the use of hiring a boutique PR agency with experience in your industry if they do not know how to get you to the next level, whether that’s additional funding, an M/A event, or an IPO event? What you really want is to hire a PR firm with experience in taking you to that next level and help you accomplish your business goals.

There are two or three reasons why ambitious and fast-growing startups initiate PR, and they are all vital business objectives. Ultimately, PR is almost always at the junction of a critical turning point for companies of all stages, from startup to hypergrowth to IPO. And the reason for that is simple: there’s no better asset than a strong, trusted, and well-known brand; brand value can add tens of millions to valuations.

 

Next Level: Additional Funding

Do investors care about PR? They do, but for different reasons than you might think. Investors want companies that think big, but increasingly do so responsibly. One reason PR is a good investment is you can activate your PR for years after you receive it. A steady stream of PR makes it much easier for a company to grow,  and PR provides social proof that helps a company secure traction, and also become an industry leader. Think about the startup founders who have used PR brilliantly to become one of the top providers in their verticals. From Marc Benioff of Salesforce to Richard Branson at Virgin, startup founders who leverage marketing and PR inspire confidence when their thinking is bold and audacious – PR puts audacious thinking on display like no other marketing medium. Finding a PR firm with experience with companies seeking investment could not be more important.

 

The Right Partners: Mergers and Acquisitions

PR paves the path for mergers and acquisitions; it gives potential buyers and partners an opportunity to learn more about the business in a good way. Plus, PR exposes your brand to more buyers than you could ever find on your own. And the more people you’re exposed to, the more likely you are to find the right partner. Plus, companies at the top of a vertical command a premium.

Whether you need B2B PR or a B2C PR  will impact your PR agency choices, particularly if your goal is M/A, but again, that will largely depend on your strategy. Are you using PR to bolster consumer enthusiasm and growth around the product in order to attract more potential buyers, or are you looking for investors who are very specifically looking for opportunities within a particular segment? These are two very different strategies.

Count Down: Pre-IPO PR

Pre IPO is another PR strategy all altogether, and it’s important to have a PR firm that understands the ramp-up and regulatory conditions of an IPO. Whether you need B2B tech PR agency  or a consumer tech pr agency, you need a PR agency that has been through the ropes of an IPO. A PR agency with Pre-IPO experience helps you set the stage during those critical 24-36 months before your IPO. While you’ll want an investor relations agency to develop your road show and connect you with the right bankers, your PR team should be working in tandem  for positive public relations that analysts will want to see. Since PR is a ramp, not a straight line, plan on investing in PR a minimum of 16 months before your IPO – the longer, the better the pay-off. Involve your PR agency with your investor relations firm well in advance so they can build trust and collaboration and work as a team.

Crisis: PR Experts Needed

If you’re in crisis, and you don’t already have a PR firm or a crisis management plan, then you definitely need a PR agency with experience in crisis communications. Crisis management is very specific to your situation, and the stakeholders will frequently determine the who you choose as a PR team. If you’re challenge is regulatory, a PR team with experience in the regulatory environment is critical, as is a PR team who can evaluate the situation quickly, and act fast. An experienced crisis communications expert will be able to guide you through the process over the course of days, weeks and even months – because getting through the crisis is one thing, but repairing your reputation, to get things back on track, is another.

PR is a serious endeavor with serious potential to change a company’s future. Ensuring you find a firm that has experience in exactly what you need means finding an agency who has moved the needle and elevated companies from one phase of growth to the next. Ultimately, finding a PR firm with experience relevant to you starts with knowing where you want to end up.

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How PR Helps Secure Investors

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If you’re raising an investment round, you may have considered PR. Whether someone suggested it to you or you’re PR curious, you’ve probably wondered why PR comes up so often when you’re seeking investment. From your Series A and beyond, a good reputation helps you raise more money faster. PR helps you attract investors, provides ongoing confidence to investors, and helps the company’s valuation. These are the reasons investors like to see companies use some investment funds for marketing and PR. They know you can run a profitable business without PR, but you can’t be the market leader without PR. So, when should a startup hire a PR firm?  We work with a lot of companies either seeking acquisition or raising funds. Let’s dig deeper into how PR helps secure investors.

First Step: Segment Awareness

Many companies discount B2B or industry PR because industry publications don’t have the public cache of larger business publications like Bloomberg or the Wall Street Journal.

But that’s a mistake. Industry PR is one of the most underrated PR assets when looking for investors. Investors often circle an emerging industry sector, like healthtech or cleantech or cannabis,  to find opportunities, and vertical publications are a great resource. Let’s face it – your startup will not be a unicorn until you’re a segment leader. This type of PR might include thought leadership or owned content campaigns. If your company does not have many search results, industry PR is a natural first step.

There’s another reason to start there: it’s excellent practice. Having 10-15 interviews under your belt really makes a huge difference when you DO get an interview with a national publication. And these credible pieces show investors you’re ready for a capital raise.

Use Data and Insights for VC Funding

A key trend in securing media is providing data to journalists. Journalists are more constrained than ever before. Third-party, statistically relevant data is the crown jewel for consumer business publications like Fortune and Bloomberg. But if you don’t have that kind of research, especially if you’re a SaaS company use the data at your disposal. I don’t mean customer data, I mean information like trends that your product is seeing.

The media isn’t the only stakeholder group that loves data: VCs do, too. Having this data really gives you many ways to capture VC attention, drive and lead conversations, and earn trust from stakeholders. And the best part? You can keep some of this data private and in your pitch deck, which you can use in your funding pitches.

Build Today for Tomorrow’s Funding

Less than 1% of companies appear in the Wall Street Journal or Forbes. Earned media is valuable because it’s difficult to secure, and the credibility factor is greater than anything you can buy. But quality PR is a marathon, not a sprint, and the investment in PR becomes more valuable over time because the more press you secure, the more likely you are to be seen as credible.

Sometimes, companies who are raising funds come to us to help them close a deal. They say, “If I could get a few pieces of press next week, that would be great.” While we might assist you with some sponsored content or contributed content, that’s still an incredibly tight turnaround for us, in part because we don’t know your brand, your voice, and your leadership. And unless you’re already in the news cycle, it’s even less likely a company will secure earned media in that time frame.

PR for investors takes time. PR is branding to journalists. Here’s a typical situation: our groundwork pays off when a newsjacking opportunity presents itself, and journalists trust our client because we had been building that trust for three months already. After that, the company became a credible source for relevant topics for some of the world’s biggest media outlets.

Remember, credibility is not something you turn on and off; it’s something you nurture and guide. That’s PR, and that’s why it’s so valuable when you’re raising capital.

Added Bonus: Crisis PR Preparation

When you’re in the middle of a raise, that’s the last time to scramble for crisis PR. Should you have a crisis, whether that’s a product recall or something more complicated, when you’re raising money or pre-IPO, PR can be the difference between simply surviving and thriving after a crisis.

Crisis campaigns start at $20,000, and that’s after you find a PR firm while your crisis is spinning out of control. When you have a PR firm on retainer, the crisis will still be expensive, but your management of it will be swifter, more strategic, and more effective. With the help of a good PR firm, you can steer your way through the crisis and out the other side with confidence and your brand intact. You might even get bonus points from investors for handling the crisis well.

Taking care of your reputation always pays dividends. When the timing is right to raise capital, that’s a great time to hire a PR agency. A good reputation will help you raise more money, faster.

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Why Is PR So Expensive?

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I have a friend who once described PR as the “dark arts,” and while I completely disagree with that assessment, what he was getting at is he really didn’t understand how PR works. Reputable PR firms are the opposite of “dark arts”; they’re very transparent. There are some tools of the trade that PR agencies keep close to themselves, but really, there isn’t anything magical about HOW PR works; it’s just a specific combination of relationships, hard work, strategy, and culture. And that specific combination takes a long time to acquire, requiring commitment to the craft. But why PR is expensive isn’t because of human hours worked. Ultimately, there is a price to the human capital, but that’s not really why PR is expensive.

So, Why Is PR Expensive?

PR is expensive because the outcomes are so important and relevant. PR’s lasting value is in improving a brand’s reputation like no other marketing lever can. For companies wanting to be acquired or IPO, your PR investment ROI could be hundreds of millions of dollars.  PR outcomes range from high valuations at IPO or during capital raises to making advertising more efficient and reducing time to sale for both B2B and B2C customers. In short, it’s not unusual for PR outcomes to be more than 10X the investment. To 10X investment, the most impactful PR aligns with trust and loyalty, which requires consistency.

For many ambitious companies, the long-term benefits of PR are sometimes forgotten, and yet that can be considerable. Due in part to high marketing budgets during the pandemic, brand valuations increased dramatically in 2023 – from 6.3% growth to 9.7% growth.

 

What is a Good PR Budget?

When considering your PR agency budget, your budget should match your goals. If you’re trying to grow your business, your overall marketing budget and PR should increase.

As of the fall of 2023, according to The CMO Survey, the average marketing budget was 10.6% of budget and 9.2% of revenues. For companies with $10-$25 million in revenue, the average spend was 15.5% of revenues. So, if you’re looking to be above average, your overall marketing budget should be higher than that. For companies under $10 million in revenue, the number was 19% of revenue. And consumer packaged goods reported spending 25% of their budget on marketing and PR.

If you’re an ambitious brand or fast-growing company, your budget could be 25% of revenue – is that aggressive? Yes. It is. Again, that’s a budget to grow considerably. A good rule of thumb for your budget might break down like this: 20% content, 20% advertising, 20% PR, 20% SEO, 20% activations.

While your distribution might vary depending on your goals – for example, if you’re raising money or looking for a M/A event, you might skip advertising all altogether and move that to PR and content. Alternatively, if you’re a consumer brand,  you might increase the content and advertising portions and focus your PR budget on certain campaigns. Emerging industries may need larger PR budgets because they need to create public and investor trust.

Based on the rates of PR agencies your budget may be higher or lower based on the experience level of your agency team. Naturally, less seasoned agency teams will be less expensive. But it’s probably more important for you to budget based on your goals.

If you’re ambitious or seeking investment or pre-IPO, your marketing budget should match those very important objectives and allocate 12%-17% of revenues or target valuations to marketing, with a third of that, at least, going to PR. Depending on whether you’re a B2B or B2C company.

How Does PR Make a Company More Competitive?

68% of CMOs reported expecting more intense customer rivalry in the coming year. In B2B segments, that number increased to 73%, with 61% expecting more innovation. By themselves, even new products don’t excite people without a story. If your company is new, you need to define a compelling story, and you need to tell it over and over. Whether you’re a tech company, or a consumer product company, PR is a key part of how people discover new products.

According to Nielson, global CMOs said brand recall was the #1 most important goal in media. Advertising is ubiquitous, and advertising is an important part of any marketing budget. After a while, ads blend in a social feed or even on TV. But if your product or CEO is in a magazine, people remember that. They might not even remember WHAT was said, they’ll remember that they saw it there. Brand recall is critical to the sales funnel. If people can’t remember your company, how will they purchase from it?

PR’s lasting impact is its value, including the fact that earned media lives forever. Less than 1% of companies ever get PR for their company, so by being in that top 1%, you’ve already differentiated yourself. Can you start a company without PR? Absolutely. Can your company thrive without PR? No. There are no household names without PR at the table, period. There are no industry leaders without PR.

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How B2B Service Companies Stay Competitive in Uncertain Times

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B2B services are high-stakes. Whether you’re a SaaS company, or provide other enterprise services like Recruiting, CleanTech, or HealthTech, the competition is stiff, and the TAM, while it might be valuable, isn’t likely huge. And with today’s high levels of uncertainty, for B2B companies, it’s more important than ever to make the decision-making process easier than ever, secure additional investment or prepare for IPO. So how do winning B2B service companies stay competitive during times of uncertainty?

 

Thought Leadership for B2B Competitive Advantage

B2B CEOs have a bird’s-eye view of their industry and marketplace trends – they have to, so they know how to steer the company. This often includes insights that are valuable to your target buyer. If you haven’t already, now is a great time to use executive visibility to increase brand awareness. Yes, your CEO can and should champion your company, but they can gain the trust of insiders and analysts by contributing to the conversation within your industry.

There have never been more media opportunities for CEOs with distinct points of view. The opportunities are endless, from podcasts to opinion pieces and contributed insights. Take the time to create a topic calendar, and remember that podcasts often book months in advance, and contributed content usually has an editorial process that can take three weeks or more.

If your Google search “Who is [executive name]” doesn’t return pages worth of positive, reputation-building content, now is the time to remedy that. Executive visibility is critical in B2B services.

Leveraging PR as Content

Getting the interview or coverage is great, but you can make that coverage work for you when you leverage your PR. Activating your PR coverage makes it more valuable to you and is a great way to support the journalist. And just like a lot of content, you can re-use your PR for a long time. There’s no shame in sharing it repeatedly on social media. Just use your content judgment about context, platform, and frequency.

 

Owned Content For Trust That Supercharges B2B Services

B2B service companies can stay competitive by leveraging PR; from case studies to reports and statistics, B2B companies make waves and even national news with trends and statistics. General business and industry journalists share something: their love for data. Put together notable data points that you can share in your owned content and use it as a jumping-off point for topical pitches all year long.

While B2B media coverage often depends on long lead times, creating your own content is not. Use owned content to share your own narrative and improve your company’s LinkedIn presence. While we’re at it, consider launching a blog on Medium or LinkedIn. Despite what people say, you can repurpose content on these platforms and they are great inbound links and another way to get your message out to the targeted audience.

 

Be More Than Press Releases

There’s more to PR than press releases. Don’t get me wrong – press releases have a role in the content eco-system, but they aren’t useful for securing media.

For quality B2B coverage, your storytelling must include at least two of these three elements:

  • Timeliness/trending news tie-in
  • Clear audience impact/relevance/newsworthiness
  • Statistics and data which add context or change long-held assumptions

Emerging industry media coverage has an advantage regarding newsworthiness, but be careful not to fall into the lazy PR trap of describing everything as “innovative.” Emerging industries really need to craft compelling stories, and brands that differentiate set the agenda. Look at Marc Benioff at SalesForce. Over the years, SalesForce has set a lot of agendas, from employee culture to event marketing with Dreamforce. Benioff knew that great B2B storytelling spanned an array of topics, and headlines drove trust, and investor confidence, and attracted top talent – he knew not every piece of coverage had to look like a sales piece in order to be effective.

For quality media coverage, you must be ready and able to share who your customers are and how they benefit. Your case studies are critical – while no journalist will write an article based on your case studies, ensuring your spokespersons can articulate the case studies in a brand-consistent, media savvy way will make news coverage even more beneficial.

 

Times of economic uncertainty can be times for groundbreaking growth for B2B companies. Whether your company is pre-IPO or you are raising venture capital, PR is your partner and you can leverage it during times of uncertainty to keep growing when others are flailing.

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8 Essential PR Components for a Successful IPO

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I was on a webinar presented by Morgan Stanley and PwC about preparing for an IPO – and something struck me – there was optimism, and the organizations were signaling their faith in the return of IPOs, soon. 2023 has been an IPO graveyard, but as one host said, “One thing we know is markets change, and so it will also be for the low point of IPOs.” Their advice? Prepare now. Preparing for an IPO is a daunting task for any startup, and the focus is often on due diligence. Yet communications and PR are critical to public offering preparedness. What do pre-IPO companies need to do from a communication standpoint? 

 

Reputation Building 

Bankers know that when you pitch them for your IPO, the company has a verified financial model and total addressable market (TAM). And founders know investors are looking for the next $1 billion brand. This makes your company’s reputation extremely relevant. So when you’re looking to stand out to investors, nothing shows social proof quite as well as media coverage. Media coverage can go on the road with you and helps you stand out to investors. Confident, media savvy CEOs give investors confidence; it shows you can handle a very different role as CEO of a public company. 

Thought leadership is vital to reputation building. During this growth stage, executive visibility is more relevant than ever. Since a solid thought leadership program takes time and strategy, we recommend starting a thought leadership program at least 24 months before a desired IPO. 

Create a Compelling Narrative

Many founders mistake the pitch to investors as the corporate narrative. The two are cousins, but different. The narrative should resonate with key stakeholders, investors, and the public, highlighting the company’s mission, accomplishments, and long-term vision.

Know the Difference Between IR and PR

IR (investor relations) and PR (public relations) have important but slightly different roles in a company’s growth pre-IPO phase. Investor relations focuses almost solely on analysts covering topics your potential investors care about. Meanwhile, PR is targeted towards a broader set of journalists, and the public at large. They can and should work together. For example, both should play a role in any press releases. IR will ensure due diligence is met and ensure the investor messaging is correct, while PR will want to ensure the brand message is consistent and the media targets get the information they need. 

Crisis Planning 

The best time to manage a crisis is before a crisis. Before you go public, and get caught up in all the details of going public, plan for a crisis. How you handle a crisis will affect your brand, and god forbid you to have a crisis during your roadshow or quiet period. Your crisis planning should include many scenarios, from the employee, to property, to product, and, yes, cyber security. Every one of these scenarios could require different stakeholder involvement and point persons. Your crisis planning should include table top exercises and the executive team should review crisis PR plans at least once yearly. 

ESG Planning 

 Investors want to be part of companies with the broadest investor audience, and ESG (environmental, social and governance) is part of that, especially since some brokerage firms and mutual funds are offering investment products that employ ESG strategies. Larry Fink, Blackrock CEO, and co-founder, said ESG is “capitalism, driven by mutually beneficial relationships between you, the employees, customers, suppliers, and communities your company relies on to prosper,”.

From a PR perspective, ESG and even purpose-driven brands have special sensitivities, and it’s important to have a coherent plan and PR strategy for these talking points for all your stakeholders, from investors to customers. ESG is not just for the “woke” – investors see the writing on the wall and have for some time. Also, buyers beyond GenZ see the importance of ESG. 

Audit Your External Communications 

Ensure your website and any owned media meet all regulatory requirements – including executive bios, blog posts, and social media. Look at this moment as your last chance to shower before prom. Your website and social media should also be robust and brand consistent. You want everyone to see you in your best possible light, and the most accessible way for new friends to get to know you is your website. 

Media Training 

The press is not the enemy, but they aren’t here to be your BFF either. Talking to the press live and learning to work with the media under various conditions, including in person with lights and mics, is a skill. While you may have undergone media preparedness before interviews, now is the time to take on a full media training program for your CEO, executives and spokespersons, including anyone who attends public events (like trade shows) on your behalf. 

Expect media training to take several days of intense hands-on training and review. Since all relevant stakeholders will be together, it is also a good time to review and practice your crisis plan too. Since media training is a skill, conducting this exercise well before IPO is recommended. 

The Big Show

Your company will never again go public. This is one of the few indisputably great news moments.  Someone (not the CEO) must ensure the moment is documented and promoted. Do not miss this once-in-a-lifetime opportunity. It’s true – not every company makes the front page of the Wall Street Journal when they go public, but it is news – and someone will care. Using this opportunity to connect with journalists is key; it’s a great time to fill up the trust bucket in the eyes of journalists. 

Prepare for the moment with some notable key messages and brand-worthy must-airs. Run through your must airs and make sure you are prepared to answer questions that might come your way. Have your day meticulously planned with your communications in mind and watch the accolades roll in. 

Effective pre-IPO PR planning is crucial for companies aiming to go public. By crafting an interesting narrative, engaging media and influencers, developing investor communication strategies, building a strong online presence, managing crises, leveraging thought leadership opportunities, and engaging internal stakeholders, companies can establish a positive brand image, attract investors, and generate enthusiasm around their IPO. 

 

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Pre-IPO PR Roadmap for Startups: Cybersecurity and ESG

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It’s impossible to ignore the dismal status of IPOs right now. But investor advisors from PwC to Morgan Stanley are reminding startups – this will eventually change, and startups need to use this time strategically. As startups embark on their journey toward an initial public offering (IPO), they face many challenges and considerations.  Investors want to know that companies are reaching the widest audience and protecting their reputations, making cybersecurity and ESG  indispensable imperatives in the Pre-IPO PR roadmap.

While fundraising, growth strategies, and market positioning often take center stage, it is critical not to overlook two essential communication and PR components today’s investors are emphasizing their significance in building trust, mitigating risks, and ensuring long-term success.

Safeguarding Valuable Assets: Cybersecurity

In today’s interconnected world, cybersecurity is no longer an optional investment but a fundamental requirement for startups. As businesses increasingly rely on digital infrastructure, the risks associated with cyber threats have intensified. Investors, stakeholders, and customers are acutely aware of the potential damage from a data breach or a cyberattack. Therefore, startups must prioritize cybersecurity as an integral part of their pre-IPO roadmap, including the crisis communication plan.

Implementing robust cybersecurity measures shows a company’s commitment to safeguarding valuable assets, including intellectual property, customer data, and sensitive financial information. By conducting regular risk assessments, developing comprehensive incident response plans, and adopting cutting-edge security technologies, startups can instill confidence in their investors and inspire customer trust. A strong cybersecurity posture can serve as a competitive advantage, differentiating the startup from competitors and reassuring potential investors about the company’s ability to protect its digital infrastructure.

ESG: A Paradigm Shift in Investor Expectations

Environmental, Social, and Governance (ESG) factors have emerged as a defining criterion for investors, signaling a significant shift in market dynamics. Startups must recognize the growing importance of ESG considerations and integrate them into their pre-IPO PR roadmap to attract sustainable and responsible investment. Communicating ESG can be volatile, so it’s imperative to incorporate seasoned Pre-IPO PR pros.

Environmental Responsibility: Startups must demonstrate their commitment to minimizing their environmental footprint. Adopting eco-friendly practices, promoting energy efficiency, and embracing sustainable business models are crucial in aligning with investor expectations and addressing climate change concerns.

Social Impact: Investors increasingly demand that companies prioritize social impact and contribute positively to their communities. Startups can emphasize diversity and inclusion programs, ethical supply chain management, and social responsibility projects to showcase their commitment to social values.

Governance: Good corporate governance practices are essential for startups as they navigate the path to IPO. Establishing a robust governance framework, including transparent decision-making processes, strong internal controls, and effective risk management, not only safeguards the interests of shareholders but also signals a commitment to ethical business practices.

By embracing ESG principles, startups can attract socially responsible investors who value sustainable growth and positive impact. Integration of ESG considerations also mitigates potential risks, enhances the startup’s reputation, and fosters long-term resilience.

Regulatory Compliance and Risk Mitigation

In the pre-IPO phase, startups must proactively address regulatory compliance and risk management to instill confidence in potential investors and avoid legal pitfalls. Regulatory frameworks surrounding cybersecurity and data privacy constantly evolve, necessitating startups to stay abreast of legal requirements and industry best practices.

Compliance with regulations such as the General Data Protection Regulation (GDPR) or the California Consumer Privacy Act (CCPA) is crucial to avoid costly penalties and reputational damage. Startups must implement robust data protection measures, including encryption, access controls, and regular audits, to ensure the security and privacy of customer data.

Startups must conduct thorough risk assessments to identify potential vulnerabilities and implement risk mitigation controls. By proactively addressing cybersecurity and ESG-related risks, startups can protect their reputation, foster trust with investors, and secure their future as successful public companies.

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