TheGreenBaron.com - Corporate Strategies - Part Three
"I would rather have a million friends than a million dollars." - Eddie Rickenbacker
“While you’re at it - why not have both?” – The Green Baron
Let’s use two very successful and well known public Social Media companies as examples:
The first is the Social Media giant; Twitter.com - What does Twitter (one of the most successful and recognized companies in the world), the “brick-and-mortar” company, build? - Basically nothing. And yet, what are Twitter the “stock company” and its owners worth? BILLIONS!
The second example is also a well known and very successful Social Media Giant; Facebook.com – Like Twitter, what does Facebook the “brick-and-mortar” company (also one of the most successful and recognized companies in the world), build? – Again, basically nothing. And yet, what are Facebook the “stock company” and its owners worth? Same answer; BILLIONS!
Regardless of what your public company does, sells or “builds” – one of the greatest sources of revenue, resources and opportunities for growth is your company’s stock and shareholders. Just ask any of today’s multi-billionaire CEO’s whose companies literally build nothing – except of course their share value. So how do companies that literally build nothing become household names and multi-billion dollar enterprises? Just ask their shareholders. With enough supportive shareholders, there is nothing you and your company cannot accomplish…together.
The Difference Between Investor Relations (IR) and Shareholder Relations:
The difference between “Investor Relations” and “Shareholder Relations” is akin to the difference between the neighborhood you live in versus the house you live in. Even though you technically live in both, and both represent an important interest and financial value to you – we think you see the difference. The question is, which one has more “value to you”, which one do you feel a higher obligation to, and how do you treat one versus the other? Simply put, the real difference between your neighborhood and your house is this; one is really yours and the other really isn’t. Your house belongs to you – your neighborhood you only have access to. Converting this concept to your public company; your shareholders (house) belong to you and investors (neighborhood) you currently only have access to. Now, let me ask you a question regarding your house versus your neighborhood – how would your life improve (financially and otherwise) if you owned every house in your neighborhood instead of just the one you live in? Again, let’s convert that concept to your company – how would your company improve (financially and otherwise) if all of those “investors” you now only have access to, became your shareholders?
Treat your shareholders casually – and your public company may end up a casualty – and “casually” is no way to treat your company’s greatest and most powerful asset!
The Green Baron has surveyed over 10,000 active penny stock traders asking them to respond with the main things they want from the companies they invest in. According to the respondents these are the 4 primary things shareholders want from the companies they invest in – listed below by the order of importance to them:
Did you notice there are three more important things a shareholder wants from a company than a “profit”? We conducted this same survey several times over the years to confirm the results and they were the same every time. Shareholders may come and go…but they never change.
Let’s break each one down individually:
1. RECOGNITION: Shareholders not only want the company to “recognize” that they even exist – more importantly, they want their contribution in time, support, risk and money they invested in your company to also be recognized (and hopefully appreciated) – not just in words but demonstrated by the actions and efforts from the company. They aren’t satisfied just hearing it from the company – they want to see it and believe it…and seeing is believing.
2. PARTICIPATION: The Green Baron has conducted over 200 audio interviews with senior executives of public companies and one of the questions we asked every one of them was, “How they first became involved with their company?” At least 30% answered, “As a shareholder”. Your company’s shareholders are one of your greatest external and internal resources available to you. Think of them as your own corporate resource pool that can protect and promote your company and stock in places and ways that you and your company cannot – and statistically speaking have a 30% chance of one day helping you manage and grow your company as a partner, senior executive or employee. You would be surprised by the large number of your shareholders who right now are ready, willing and able to “participate” in supporting and helping in the growth and success of your company, share value and their investment in your company - all they need from you is to give them that opportunity and to lead them in the right direction. Leadership is easy if you’re willing to assume it. So, how will your shareholders know that you want them to “participate” in your joint success? Tell them, show them then lead them.
3. EMPATHY: Do you demonstrate to (or even tell) your shareholders that you value them (and their support – financial or otherwise) and have “empathy” towards the time, money and risk they have invested in your company? Again, they not only want to hear it – they want to see it demonstrated. The most important thing for investors next to hearing about your company, is hearing from your company.
4. PROFIT: Why do some shareholders continue to hold a particular stock that is steadily dropping in price – often resulting in a substantial loss to that investor? Sometimes it’s the hope that somehow the company will turn things around and the share price will experience a rebound. But many times it’s simply because the company gave them the three things they value more than profit; Recognition, Participation and Empathy. Give your shareholders those three things – and they’ll be more understanding (and forgiving) for any shortfalls (ideally temporary) in profit they may experience.
READ PART ONE: The Basics of Gaining and Maintaining Loyal and Supportive Shareholders - Implementing the Plan - Working With Your Shareholders - Turning Business Contacts into Personal Relationships - Using your Company to Attract Investors and Shareholders
READ PART TWO: Creating Your Own Success Story – Tools of Your Trade - Exponentially Increasing Your Shareholder Base – Control and the Ability to Delegate With Confidence - Getting Your Team on Board - Effectively Handling Good and Bad News
READ PART THREE: Your “Stock Company” Versus Your "Corporate" Company – Investor Relations Versus Shareholder Relations – What Shareholders Want and Expect From Your Company - Addressing Shareholder Priorities
READ PART FOUR: The Process for Building a Large and Supportive Shareholder Base – Using Effective Communication to Create Fame and Fortune - The Three Types of Effective Communication - The Cycle of Converting Investors Into Shareholders
READ PART FIVE: Understanding and Retaining Shareholders – Working For Your Shareholders – Increasing Corporate and Share Value – The H.A.B.U. Principle – Effective Time Management – More Techniques for Converting Investors Into Shareholders - The Real Bottom Line
READ PART SIX: The Green Baron's Top 25 Techniques for Gaining, Maintaining and Increasing Corporate and Share Value - Understanding Investors and Knowing Your Shareholders