Tag Archive for: startup PR advice

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 an 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

 

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, with or without a pending IPO.

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.

As uncertainty rises, funding falls. At least that’s what the news would have you believe. But according to Inc. magazine, seed and angel deals are still trending upward, and early-stage companies with proven product are still getting most of the deals. In fact, 64% of venture funding is early stage, and seed deals through Q2 of 2022 were on par with the entirety of 2019 (Q2 NVCA/PitchBook). That means for hyper-growth or ambitious companies and challenger brands, there is still an opportunity for you. So what should you do when VC funding is down and inflation is still driving uncertainty? I’ve been through every recession since 9/11 and I’ve been working with ambitious brands and companies since then as well. So I’ve seen what successful businesses do during recessions to position themselves for competitive advantage, survival and growth, despite the economic hurdles. Over the years I’ve noticed, startups who focus on looking ahead while being laser-focused, and tend to survive tumultuous times, regardless of whether your a consumer brand or a B2B company. These are the the things startups focus on for VC Funding.

Focus Your Energies and Budget

“Everything you do, do exceptionally well, and if you aren’t exceptional at it, then get rid of it or outsource it.”

Look at everything you’re doing and cut out the things you aren’t doing well. For example, let’s say your internal biz development team is excellent, but your event marketing isn’t producing the results you’d hoped for, take that event marketing budget and focus it on one thing your biz dev team says they need to get to the next level.

Everything you do, do exceptionally well, and if you aren’t exceptional at it, then get rid of it or outsource it. Outsourcing is just more nimble. What you outsource, be exceptionally clear about your goals, so you can maximize your reduced budget. Focusing your time and budget has the additional advantage of clearing out the cobwebs and giving you new insight into operational efficiencies too. Who knows? You might decide that outsourcing certain strategies, like PR, simply works better than doing it in-house, anyway.

Startups should also focus on the long term. Think about ways you can increase efficiencies with agency partners, and where you can maximize the partners you have on board.

 

Bullish on the Future

“Deals are still happening, but they’re more happening on industries and trends which are moving ahead full steam, no matter what happens to the economy,”

What should a startup focus on when thinking about funding? No matter what happens to the economy, innovation rolls forward, and VCs know this. The money isn’t on solving today’s problems, it’s on solving tomorrow’s problems. According to Pitchbook, in Q1 of 2022, VC’s raised more money than in the entirety of 2019. So are coming down? Oh, absolutely, but VC’s know – the future is now.

Even when funding is down, deals are still happening, but they’re more happening on industries and trends which are moving ahead full steam. So do your homework on where your product fits into the biggest challenges or opportunities in the next 5, 10, 15 years. Look at all the challenges the pandemic brought to light – those challenges are still top of mind, and the companies solving those problems will have a head start. Your corporate storytelling should also lean into the future and purpose driven initiatives. These two aspects will allow you to lead against your peers.

FinTech is another area where the gloom and doom may be over-reported – through Q2, FinTech funding was still more than in 2019, but it’s definitely not as frothy as 2021. FinTech founders may wish to focus on thought leadership and tie it into purpose-driven points of view in order to tap into future trends.

And although the cannabis industry has been experiencing its share of disruptions as of late, no one thinks that industry is disappearing, the growth is only projected to increase as more states move to legalize cannabis, and states create interstate sales as California has, and many expect the east coast to do. Experts predict the cannabis industry will be $100 billion by the end of the decade. You can learn a lot about the future of cannabis by reviewing the pitch decks from startups that recently secured funding.

CleanTech is another area of hypergrowth, spurred in part by the Inflation Reduction Act which incentivizes green technology businesses. Experts predict growth in this segment for years to come. But VCs have been burned in this area, so it’s vital that companies raising funds in this segment double down on trust.

PR for AI companies is another area likely to continue growing. While the initial buzz that spiked with the launch of ChatGPT has settled, investors still haven’t settled on the market leaders in this segment. If you’re an AI company, PR is best asset right now, especially if you’re a B2B AI company.

There are always areas of growing investments, and if you’re in one of them, strike while the iron is hot.

Plan For Success

“Companies that survive this time focus… on problem-solving,”

Now is the time to think out loud and do your due diligence for tomorrow. Companies that survive this time focus their operations team on problem-solving. For example, if  VC funding doesn’t seem likely for you right now, turn your attention to policy initiatives at the federal and local levels. For example, the last infrastructure project had a lot of opportunities for climate-related startups. And the 2021 infrastructure package held lots of tidbits for infrastructure tech programs, that emerging industries like drones and UOV could take advantage of.

Consumer tech VC funding has taken a sharp nose-dive. Storytelling PR campaigns may not be as attractive as they once were for consumer tech. Now is the time to look at product-based programs which increase awareness but not the budget.

Mental health is still top of mind; that’s part of the reason emerging industries like healthtech, cannabis, and psychedelic treatments remain in the sights of investors. But these industries are not without their challenges and competitors. So brands in these emerging industries need to double down on trust to build more acceptance for the communities they serve.

Direct to Consumer (DTC) funding has radically pulled back because simply having a DTC company isn’t enough to attract investment – today, a DTC strategy is an expectation. But startups can take this time to develop something that can’t easily be replicated, like technology. Or, as investor Caitlin Strandberg said, don’t even ask for investment unless you have an Amazon strategy, because social media isn’t where they see buyers, “if you’re going to be where people buy—people are buying more and more on Amazon—you can expect they’ll search your brand name on Amazon, and you want to be on that search page,” so be looking your sales channels along with SEO and digital PR so your startup is poised for growth.

One of the best ways to stay focused on success is to lay the groundwork for a successful IPO. There is a lot to do, both internally and externally, and getting started earlier will save you money and time as the exit gets closer.

You should take this opportunity to do some scenario planning as well. Now is a great time to plan for a crisis, and create plans for things like cyber breaches ,which will help you secure your future.

 

Tomorrow’s greatest companies and emerging industries aren’t going to allow this uncertainty to derail them. This is where the rubber meets the road, and strategy makes a difference.

OK.  I’ll admit it. I watch Silicon Valley on HBO.

I hate admitting it because, of course, it’s both a characterization and just a little too close for comfort to the startup experience.

Last night’s episode had me laughing and crying.

Let me set the scene: The founder and the coders are desperately trying to hire new developers in a competitive market, time is short and so is money.  Meanwhile, in the board room, the newly minted but completely wacko investor insists the startup spend $30K on “schwag.”  It’s a classically stressful startup moment.

I cringe.

No one asks any questions – the founders are too caught off guard by the mere suggestion. And yet, it’s patently obvious no one except the wildly erratic investor, who also spend a load of cash on billboards, has started to even think about marketing and branding.

Everyone’s thinking “splash” and no one is thinking “strategy.”

Here’s a pro-tip: “Splashes” without “Strategy” are usually huge wastes of money.

I don’t care how awesome your product is – you HAVE to think about branding and marketing for your startup. But the worst way to do it is in a scattershot “yah, let’s spend money on that,” way. Every startup has a “Shwag” moment.

I remember one startup I worked on wanted to spend $100K on hiring a talent for a “viral video.” Another spent over five-hundred thousand dollars on print ads.

Both happened for one reason only: everyone was in splash mode and no one was in strategy mode.

Here are 5 Ways To Know Whether It’s YOUR Time for “Schwag”

1. Have you done a pre-launch marketing plan?

Before you go to launch, you’re going to need a marketing plan. Sounds obvious, except, it’s one of the hardest things for startups to focus on.

Through the haze of late nights and Redbull, frantic pivots and resource challenges, marketing strategy for launch is often overlooked.

Consequently, decisions like “we need to spend $30K on “shwag” happen in the moment and they happen quickly and then happen when everyone is actually focused elsewhere.

If there’s one place you need a plan for launch it’s in marketing. If you’re doing your pre-launch homework, you might just be well positioned for your splash.

2. Who’s Suggesting?

I know you wouldn’t take code advice from me. You shouldn’t. If I ever give it you, send me packing.

Get your experts and resources in order and more importantly, listen to them.

There’s going to come a point when someone or many people will start telling you what you should do, most of whom have no idea what you’re TRYING to do.  The better your relationship with your marketing expert, the more you’ll know whether you’re getting good advice from everyone else.

3. Who’s Implementing?

What’s the point of your “shwag?” Whose getting it, when and where. Oh, yah, whose distributing it?

How many times have I seen impetuous spending happen without thought as to implementation?

Chances are – no matter what kind of “shwag” you’re investing in, you, the founder do NOT have time to implement said “shwag.” Better figure that out before you spend that $30K.

Even if you’re a master of marketing strategy, get your implementors together and THEN you’ll be ready for your splash.

4. What Questions Aren’t You Asking?

Hey, I like a new idea probably even more than the next person, but some things work consistently and some things consistently don’t work. Some risks in marketing are worth taking, some are worth testing and some are just bad.

There should be at least one person on your team, whether in-house or outsourced who says “that’s a bad idea,” once in awhile.

I’m not suggesting you have layers and layers of processes for a simple decision, but I don’t care how many millions you have, marketing is expensive, someone better be prioritizing and someone better be comfortable with “no.”

Find your “no” person. Not because they’ll throttle  you, but because they’ll let you splash at the right time.

5. How Expensive is “Cheap?”

I get it, you don’t want to spend any of your money on “shwag” but you need to. So you call your nephew or niece because they’ll do it cheap.

Unraveling “cheap” is one of the most time and energy consuming processes you can not pay for. I bet you’ve been there in other forms of development. Marketing is no different. Not only that, but you’ll find unraveling cheap costs a whole lot more than “done right the first time.”

So, next time someone wants to drop big bucks on shwag, you’ll be ready for them. AND you’ll be on your way to being ready for your splash.