How commissioned research has helped Inderes to tap the capital markets
Inderes went public in October 2021 with the idea of eating our own dogfood as a listed company. For commissioned research, we selected SEB as our first research provider, since Inderes covering itself would have probably resulted in a phone call from the FSA.
In addition to the obvious benefits of keeping our owners informed, commissioned research (or paid analysis) from a credible player like SEB has had some significant unexpected side benefits. After raising 5 MEUR in equity at the time of the IPO, we have not raised any additional equity but have used our public status and commissioned research to tap the capital markets in several ways, which I will explain in this blog post.
Financing acquisitions
When negotiating an acquisition, your own stock is like currency if you are a public company. Especially in cases of acquiring entrepreneurial companies, using own stock as payment is a strong tool to incentivize the team of the acquired company for the long term. Inderes has used its own stock to finance two transactions where we have issued 3.6 MEUR worth of new Inderes shares. In both cases, having a third-party independent analysis helped the seller to evaluate the value of our “currency”. This significantly facilitated the intense M&A negotiations.
Access to credit funding
Credit side analysts also get support from publicly available equity research reports for their work. Equity research reports include full forecasts for income statements, balance sheets and cash flow. One bank we use (for the sake of clarity it’s not SEB) has completed an evaluation of how much capacity for leverage our company could take if new investment opportunities would emerge. In this analysis, they used our publicly available research report as one data point to support their evaluation and forecasts. So far we have raised only 2 MEUR of debt to finance one acquisition – a process that was smooth and quick due to all the publicly available transparent data about Inderes.
Employee share saving program
Being a publicly listed company gives you a new toolset for incentivizing employees. Our 120 employees have invested over 2 MEUR in our company shares during the past three years. Despite knowing their own employer well, employees also benefit from having a third-party opinion and forecasts about our company. At Inderes, in our share saving program employees can invest in our own shares and they get 1:1 free matching shares after holding the stock for two years. Since you need to put in your own money it always feels safer when you have independent analysis to support your decision.
Are you interested in tapping the benefits of being a listed company?
Contact us and we will explain why we are the commissioned research provider your investors would probably choose.