Choosing the Right IR Path: Hiring vs Developing In-House
Choosing the Right Investor Relations Path: Hiring vs. Developing In-House In the realm of investor relations (IR), companies often grapple with a critical decision: whether to hire an external IR agency or to develop an in-house team. Determining the right path depends on several factors, most notably cost and the company's development stage. Let’s explore how businesses can find the right balance. Assessing Company Needs and Resources According to industry experts, the stage of a company pl...
Choosing the Right Investor Relations Path: Hiring vs. Developing In-House
In the realm of investor relations (IR), companies often grapple with a critical decision: whether to hire an external IR agency or to develop an in-house team. Determining the right path depends on several factors, most notably cost and the company's development stage. Let’s explore how businesses can find the right balance.
Assessing Company Needs and Resources
According to industry experts, the stage of a company plays a significant role in this decision. Start-ups or early-stage companies, which often have limited internal resources, might find it more beneficial to engage an external IR agency. By doing so, they gain access to a full spectrum of resources and expertise that an in-house team may not yet possess.
Understanding the Cost Dynamics
Cost is a pivotal element in deciding between an in-house team and an agency. If a company aims to have an expert IR resource internally, they should expect to invest significantly—typically around $350,000 or more per year for a proficient and experienced professional. This cost can be prohibitive for many, thus prompting the consideration of external agencies.
The Value of External Expertise
Hiring an IR agency comes with the advantage of gaining seasoned professionals who bring extensive experience and comprehensive support. Agencies often offer a multifaceted approach, complete with additional features and innovations that a single internal hire may not provide. This “hired gun” option can be especially valuable when looking to enhance the company’s visibility and credibility in investor circles.
Striking the Right Balance
Ultimately, the choice between hiring an agency and developing in-house capabilities hinges on aligning business objectives with available resources. Companies should weigh the costs against potential gains in expertise, breadth of service, and overall impact on investor relations strategies.
By carefully evaluating these factors, businesses can make a thoughtful decision that supports their growth and strengthens their connections with investors.
Disclaimer: Joshua Wilson is a registered investment banking representative and a licensed real estate broker. The content of this podcast is for informational purposes only and should not be considered legal, financial, or compliance advice. This podcast is not a substitute for professional advice. All views and opinions expressed by the host and guests are their own and do not necessarily reflect the policies or positions of any regulatory agency, organization, or employer. Listeners are encouraged to consult their own compliance teams, legal counsel, or financial advisors to ensure adherence to applicable regulations, including SEC, FINRA, and other industry-specific requirements. This podcast does not constitute a solicitation or recommendation for any financial products or services.
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Jordan Darrow
IR
Jordan M. Darrow is a career investor relations practitioner with over 25 years of experience. Drawing on his career in counseling and as a corporate executive, Mr. Darrow assists publicly-traded companies with their efforts to increase awareness among investment community, media and trade industry constituencies, as well as developing and implementing productive communications strategies among the Company’s workforce and customer base.
Prior to founding Darrow Associates in 2005, Mr. Darrow served for nearly five years as the Vice President of Investor Relations and Corporate Communications for PRIMUS Telecommunications Group, Incorporated. He had previously served as a consultant to PRIMUS. While at PRIMUS and among his professional accomplishments, Mr. Darrow contributed to the global telecommunications company’s 2003 award for Best Business Turnaround presented in the first American Business Awards (“Stevies”) competition.
Mr. Darrow began his investor relations career with Taylor Rafferty Associates, Inc. (TRA), the leading cross-border IR firm at that time. Based in New York, the firm assisted a clientele of blue chip foreign corporations in their efforts to access the US capital markets. Following TRA, Mr. Darrow rounded out his professional skills by joining The Financial Relations Board, Inc. (FRB), then the largest independent IR firm in the country. At FRB, later known as FRB/Weber Shandwick, he provided IR counsel to small- and medium-sized domestic companies, as well as led the firm’s East Coast Telecommunications and Multi-industry Market I… Read More