Transforming IR strategy: How retail shareholders drive liquidity and growth

Imagine if you had a lever to pull that would increase your company’s trading volume. How would that change every other aspect of your role and strength in the capital markets? What if achieving this liquidity was as easy as pushing a button? While this is purely hypothetical, it’s much closer to reality than most of the liquidity strategies I’ve seen offered.

For almost 20 years, I’ve worked with dozens of small-cap companies, and what I’ve found is that liquidity isn’t just a byproduct of market attention or business execution – it’s something you can proactively build by focusing on retail shareholder acquisition. While this approach may feel unfamiliar at first, it has the power to transform your company’s ability to grow once you make the shift.

The shift: From outreach to shareholder acquisition

The need for liquidity is no mystery: there are volumes of research on the topic, including studies by Robert Merton and Haim Mendelson, which show that liquidity directly impacts your company’s cost of capital and valuation. Higher liquidity means lower costs and a better chance of attracting analysts and institutions. Traditionally, liquidity efforts have been about outreach – just getting your story in front of potential investors.

But what I’ve learned from these studies is that the more shareholders you have, the more liquid your stock becomes. So instead of simply focusing on getting attention, the real opportunity lies in acquiring and nurturing retail shareholders who contribute to long-term liquidity. The shift from investor outreach to shareholder acquisition happens once you can track investors from initial outreach to becoming shareholders inside a system you can measure and manage.

Applying customer-acquisition strategies to IR

This is where my approach comes in. Over the last 20 years, I’ve applied the principles of customer acquisition – the same strategies used to build and qualify leads in sales and marketing – to investor outreach, becoming, in effect, shareholder acquisition. By leveraging digital marketing and content funnels, you can attract retail investors, nurture them over time and ultimately convert them into engaged shareholders.

What often gets overlooked is that retail investors don’t impulse-buy stocks. They need to be educated and engaged with the right content at the right time. Your messaging should focus more on why potential investors should pay attention to your company’s story, not why they should invest immediately, because they won’t. By guiding them along a journey, you allow them to make the decision to invest when they’re ready.

This shift from outreach to acquisition means you’re not just asking investors to invest – you’re inviting them to join your company’s narrative. Digital marketing tools make this easier than ever, allowing you to efficiently manage this process with automation and measurement.

Real results from real companies

If you’re wondering whether this shift works, the results speak for themselves. After launching their shareholder-acquisition strategies, my recent clients have experienced an average 4,000 percent increase in trade value and a 550 percent boost in net cash received from financing. Many of these companies have renewed with me 13 times on average – most likely because they could finally measure the value they were receiving. This isn’t just theory; this is what happens when companies focus on building an engaged audience of potential shareholders.

The path forward: Measuring your success

What I’ve learned is that the biggest paradigm shift for most IR teams is understanding that building an audience of retail shareholders gives you the power to measure success. When you focus on shareholder acquisition, you gain metrics – real, actionable data that helps you see where the bottlenecks are, adjust your messaging and optimize your efforts.

You’re no longer paying to access someone else’s audience; you’re investing in your own. And with the right tools and strategy in place, you can lower your cost of capital, increase liquidity and ultimately position your company for long-term growth.

If you’re ready to make this shift and start transforming your IR strategy, visit liquiditycoach.com and quickly learn to build your shareholder-acquisition system. Together, we can help your company build the liquidity it needs to thrive in today’s markets.