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What Is Investor Targeting, and Why Is It Important?

We have compiled the most important facts about investor targeting

by Markus Becker 3 min

    Investor targeting is a central part of every IROs responsibilities, facilitating better dialogue with existing and potential investors and proactive engagement. We offer insights on why targeting is important, when you should use targeting, and what to think about when selecting targeting tools.

    What Does Investor Targeting Entail?

    Investor targeting is the process of identifying and engaging investors to create the most value for your company, as well for shareholders. This involves gaining access to and understanding your own investor data and analyzing it. By doing so, you can craft a strategy on how to assess investor “gaps” and identify potential opportunities.

    As a first step, familiarize yourself with who makes up your shareholder base. Take some time to answer the following questions: Who is attracted to your stock and why (are you selling a growth story, a value story, are they long-term investors, or shorts?) Where are changes in the ownership, and why? Who do you want to add to your investor roster? Understand your shareholders and what investors still need engagement (or even re-engagement).

    Investor targeting not only helps you to understand your own investor landscape, but also your peers. What targets exist who do not currently hold your stock, but could be good fits based on peer holdings? How can they be approached? Are there peers outside of your industry, that have a similar structure and story? Could some of these investors be interested in your company?

    Needle in a haystack: Investor Targeting supports you in identifying relevant investors.

    Why is Targeting Important?

    As a public company, investor targeting is a significant exercise in establishing proactive investor engagement, and tapping into new pools of capital. Well-performed targeting can ensure that you are attracting the right kind of investors, maximizing shareholder value, and aligning company messaging about your equity story.

    Effective investor targeting can draw investment. This task often falls in the lap of the IR team. Investor targeting is a process of profiling investors that could be a good fit for your company (and for the investors in question). By knowing the profile of your targets, you can address them directly and thoughtfully. Use available data to assess your IR communications strategy, your differentiation amongst peers, and understand what USP you bring to the table.

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    Targeting Investors Prior to Roadshows and Meetings

    Once you have a better sense of your targets, “non-deal roadshows” and investor meetings are an important part of the IR calendar. With investor targeting, evaluate events in advance to determine if attendance is valuable given the investors to seek. If possible, identify investors who do not participate in traditional conferences and contact them directly. This can be a beneficial way to show your team’s proactive approach and interest.

    Access to investor data also helps in preparing for investor meetings, saving valuable time and creating more quality engagement. Share available information on your targets with your team and C-suite. During meetings, investor targets will appreciate information that is tailored to their needs and requirements.

    With investor targeting, evaluate events in advance to determine if attendance is valuable given the investors to seek.

    Investor Targeting Moves into Focus Under MiFID II

    In the US, investor targeting is more established than in Europe – many more IROs are focused on “selling” their stock to potential investors. With the roll-out of MiFID II, changes in sell-side coverage, and other industry shifts (for example, trends of growing passive investment), investor targeting has come to the forefront of many IRO agendas in Europe – particularly for small- and mid-cap companies.

    MiFID II obligates funds, asset managers, and other investment companies to separate costs of services related to the trading of securities from the costs of other securities-related services. For that reason, many companies are now assessing whether to allocate budgets for brokers, banks, and organized investor meetings, or whether to become more independent in their targeting activities and take on this responsibility directly.

    With the roll-out of MiFID II, investor targeting has come to the forefront of many IRO agendas in Europe.

    Investor Targeting with Strategy and Tools

    Investor targeting benefits from a thorough and thoughtful approach. Implement internal processes of analyzing data and evaluating investors, as well as developing communication strategies and planning desired meetings. Find ways to log your activities and track your targeting processes.

    When taking over targeting activities internally, having the best data at your fingertips and creating a comprehensive targeting strategy is key. Evaluate your existing targeting activities and optimize them: What can be improved?

    Today, there are many providers of investor data and targeting tools. Usually, investor data is “public ownership”, meaning that this data is publicly available. The data is gathered from different sources. When choosing a provider to help you with targeting, the number of captured data sources, the presence of a comprehensive investor overview, and constant data updates are important criteria to note. Ideally, work with a provider that will allow you to review not only your own investor structure, but also the investor data available on your peers. By only assessing public ownership data, you can make sure that to be in compliance with all data security policies. Targeting tools usually offer predefined analyses and assist identifying potential investors.


    The ultimate goal of your IR activities should be to engage the right investors for your company. Take your investor targeting into your own hands to find out which of your existing shareholders you should keep an eye on and where you can find suitable new investors. Investor targeting tools help you access investor data and implement your strategy.

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    Markus Becker
    Markus Becker

    Director Stock Surveillance and Corporate Access – EQS Group | Markus Becker has been with EQS Group since 2017 and works as Director Stock Surveillance and Corporate Access in our Munich office.