The Art of Communication Effecting IPO’s

Let the road shows begin. In a key first step, the ride-sharing company Lyft recently filed paperwork seeking to raise $2 billion, setting up presentations with investors in advance of one of the hottest IPOs of the year.

That’s saying a lot. Experts say 2019 could easily be a record year for initial public offerings, with names like Uber, WeWork, and Slack among those that may line themselves up on Wall Street. Only, according to Richard Marshall, global managing director of the Corporate Affairs and Investor Relations practice with Korn Ferry, the communications end of this high-stakes fund-raising is shifting in a way that’s critical for nearly all these firms.

Only a few years ago, investors focused on one thing: the potential return on investment. Now, in the age of the purpose movement, gender diversity issues, and other factors, communication and investor relations experts are realizing their firms need to tell a much broader story. “Numbers are only part of the story now,” says Marshall. “In today’s market, investors scrutinize a wider range of things like culture, diversity and inclusion, and environmental and social sustainability.”

What’s more, experts say, market volatility has picked up again; witness what happened to the Dow Jones Industrial Average last December. Investor patience and sentiment, never very reliable, appears to be getting shorter in a way that may affect IPOs. That creates whiplash for firms going public, and requires more agility from their communications teams.

For its part, Lyft’s offering will mark the first major test of market conditions and investor appetite; the company has priced its shares between $62 and $68, giving it a valuation of around $23 billion. If the mood on Wall Street stays upbeat, more than 150 companies will launch IPOs this year, and by some estimates in all could raise the staggering sum of $100 billion—practically the gross national product of New Zealand.

All of which, Marshall says, raises the stakes and pressure for these firms’ communications and investor relations departments to get as much buy-in as possible from an investor community that has become more critical of deals. “You need to have a more thoughtful communications strategy,” says Marshall, noting that going public is only the first step in building an all-too-critical relationship with investors and analysts. One way to accomplish that is to break down the walls that have historically separated corporate communications and investor relations, and unite the two functions to help create a synchronized business and brand messaging strategy.

The story an organization tells analysts, consumers, employees, and investors can directly impact the success of its IPO and the future of the company, Marshall says. Organizations that can tell a story that combines strong financial insight with what’s unique about its culture, talent strategy, and purpose could have a competitive advantage in an IPO.

To be sure, Lyft believes that its culture is so integral to its success that, in the IPO filing, the company explicitly listed the potential of losing it as a risk factor in becoming a public company. More pointedly, it stated, “We believe that our company culture, which promotes authenticity, empathy, and support for others, has been critical to our success.… If we cannot maintain this culture as we grow, our business could be harmed.”

You Could Be Killing Your Company’s Innovation With This One Word

Author: By Maya Hu-Chan

Member of the Association of Corporate Executive Coaches https://www.acec-association.org

Leadership expert and executive coach@mayahuchan

If you ask any leader what quality they’d like their company to embody above all else, most of them would say one word: innovation.

The ability to innovate sounds simple. Be creative! Think outside the box! Take risks! But for these things to happen, people must first work in an environment that fosters innovation and risk-taking. They must feel comfortable taking the risk to think creatively and challenge the status quo. And it’s a leader’s job to make the deliberate choices that create this kind of environment.

I recently spoke with Dr. Darlene Solomon, senior vice president and CTO of Agilent Technologies, for insights on what entrepreneurs and leaders can do to create a culture that facilitates innovation. We discussed the four things leaders must do — and the one thing they absolutely must avoid.

1. Take risks for the right reason. If you are encouraging workers to take risks, it must be in the context of the potential benefit of those risks. “You can’t just talk about risk-taking alone,” Solomon says.  This should also align with your company’s vision and strategy. If everyone understands the impact of their contributions, they have greater buy-in, and can see the value of their contributions, big and small.

2. Recognize and reward short and long-term risks. Leaders should recognize not only when risks are met with immediate reward, but also when people invest in longer-range projects that don’t result in immediate returns. Well before the end goal is achieved, leaders can set objectives along the path and reward contribution.  Recognize teams that work in high-impact/high risk areas, and continue to emphasize your trust and appreciation for their efforts, along with  the potential benefit of their work.

3. Make every voice feel heard. Leaders who create cultures of innovation and trust find a way to make sure everyone feels involved, contributes, and senses their contributions are valued. “It’s not about conforming and having everybody agree on everything,” Solomon says. In fact, everyone’s ideas won’t get the green light. But how you make those people feel about those contributions is key. “A leader is stronger by explaining why they made the decision they did,” Solomon says. Just do so in a way that’s inclusive and not divisive. For example, telling someone that a suggestion that didn’t make it actually helped the team realize and understand a greater point. The result is that person doesn’t feel rejected — they feel valued and are likely to come forward with suggestions in the future.

4. Celebrate Innovation. Agilent runs a company-wide competition every 18 months called “Agilent Innovates”; the goal is to recognize and reward innovation as a key element of Agilent’s strategy. Employees and teams from throughout the company are encouraged to   submit their innovations, whether it was for a new product or solution, or for a process improvement.  The innovations are judged based on their originality and business impact, with the final round of competition being ultimately judged by the company’s CEO staff, which names the President’s Award winners in each category. Not only does a program like this get everyone excited about innovation, it sends the message that the company values and celebrates creativity and risk-taking. “From the CEO to throughout the company, there’s a lot of energy,” Solomon says. “I think it shows that innovation is valued from everywhere in Agilent.”

 

5. Never say failure. “When a project ends, we review what we learned, what we might do differently if appropriate, or maybe how we’re going to take those learnings in a new direction.” Solomon says.  One word that never comes up? Failure. “We don’t call them failures per se. It’s about, ‘what do we do next?'” This culture neutralizes the fear of failure, which can paralyze the freedom to think creatively. “I don’t think that failure is even part of our day-to-day vocabulary,” Solomon says.

Innovation is not a hard-wired, innate gift. It’s not native to a particular region or nation. It flourishes in the right kind of environment, which any leader with sincere intent can create. “Innovation is all about challenging the status quo and I believe that creative motivated people generally have great ideas and innovate well,” Solomon says. “And as leaders we need to provide the right culture and the right leadership to sustain that innovation.”

 

You Could Be Killing Your Company’s Innovation With This One Word

Entrepreneurial leaders do four things to encourage innovation … and there’s one thing they never do

By Maya Hu-ChanLeadership expert and executive coach

CREDIT: Getty Images

If you ask any leader what quality they’d like their company to embody above all else, most of them would say one word: innovation.

The ability to innovate sounds simple. Be creative! Think outside the box! Take risks! But for these things to happen, people must first work in an environment that fosters innovation and risk-taking. They must feel comfortable taking the risk to think creatively and challenge the status quo. And it’s a leader’s job to make the deliberate choices that create this kind of environment.

I recently spoke with Dr. Darlene Solomon, senior vice president and CTO of Agilent Technologies, for insights on what entrepreneurs and leaders can do to create a culture that facilitates innovation. We discussed the four things leaders must do — and the one thing they absolutely must avoid.

1. Take risks for the right reason. If you are encouraging workers to take risks, it must be in the context of the potential benefit of those risks. “You can’t just talk about risk-taking alone,” Solomon says.  This should also align with your company’s vision and strategy. If everyone understands the impact of their contributions, they have greater buy-in, and can see the value of their contributions, big and small.

2. Recognize and reward short and long-term risks. Leaders should recognize not only when risks are met with immediate reward, but also when people invest in longer-range projects that don’t result in immediate returns. Well before the end goal is achieved, leaders can set objectives along the path and reward contribution.  Recognize teams that work in high-impact/high risk areas, and continue to emphasize your trust and appreciation for their efforts, along with  the potential benefit of their work.

3. Make every voice feel heard. Leaders who create cultures of innovation and trust find a way to make sure everyone feels involved, contributes, and senses their contributions are valued. “It’s not about conforming and having everybody agree on everything,” Solomon says. In fact, everyone’s ideas won’t get the green light. But how you make those people feel about those contributions is key. “A leader is stronger by explaining why they made the decision they did,” Solomon says. Just do so in a way that’s inclusive and not divisive. For example, telling someone that a suggestion that didn’t make it actually helped the team realize and understand a greater point. The result is that person doesn’t feel rejected — they feel valued and are likely to come forward with suggestions in the future.

4. Celebrate Innovation. Agilent runs a company-wide competition every 18 months called “Agilent Innovates”; the goal is to recognize and reward innovation as a key element of Agilent’s strategy. Employees and teams from throughout the company are encouraged to   submit their innovations, whether it was for a new product or solution, or for a process improvement.  The innovations are judged based on their originality and business impact, with the final round of competition being ultimately judged by the company’s CEO staff, which names the President’s Award winners in each category. Not only does a program like this get everyone excited about innovation, it sends the message that the company values and celebrates creativity and risk-taking. “From the CEO to throughout the company, there’s a lot of energy,” Solomon says. “I think it shows that innovation is valued from everywhere in Agilent.”

5. Never say failure. “When a project ends, we review what we learned, what we might do differently if appropriate, or maybe how we’re going to take those learnings in a new direction.” Solomon says.  One word that never comes up? Failure. “We don’t call them failures per se. It’s about, ‘what do we do next?'” This culture neutralizes the fear of failure, which can paralyze the freedom to think creatively. “I don’t think that failure is even part of our day-to-day vocabulary,” Solomon says.

Innovation is not a hard-wired, innate gift. It’s not native to a particular region or nation. It flourishes in the right kind of environment, which any leader with sincere intent can create. “Innovation is all about challenging the status quo and I believe that creative motivated people generally have great ideas and innovate well,” Solomon says. “And as leaders we need to provide the right culture and the right leadership to sustain that innovation.”