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Rose & Company has repurposed and improved upon the institutional equity sales model to enhance our clients' access to the investment community.


A changing landscape needs a new set of strategies and tactics. The constant is the need for independent perspectives from experienced capital markets professionals; professionals who hold themselves accountable to a higher standard and serve the interests of the client only. This is our mission, and the only true measurement of our success is the success of our clients.

A Fundamental Shift has Occurred

Economic realities have been driving behavioral changes on both the buy-side and the sell-side for years, but this trend has accelerated as U.S. fund managers have reduced their brokerage commission budgets by a stunning 40% from 2016 levels.  This has further pressured the global investment banking business, with revenues declining to multi-year lows. As the commission pool shrinks, banks shrink headcount in equities, further reducing the quantity and quality of services provided to corporate issuers.  Indeed, bundled equity commissions in the U.S. have declined by ~50% in the last decade.  Commission dollars allocated to equity research and corporate access have declined by ~55% in the same period.  This trend has been catalyzed by MiFID II regulations and buy-side margin compression brought about by the rise in passive investing and no-fee trading.

Public Companies are Feeling the Impact

As the structural shift in the capital markets unfolded, the traditional institutional equity sales model changed. Research analysts and salespeople are nor effectively precluded from working in tandem for the benefit of corporate clients. Rather, the model has shifted to one focused on serving the needs of the sell-side’s largest clients, which are almost exclusively hedge funds. The old model worked well for companies as the sell-side provided valuable introductions to fund managers of all varieties. It provided companies a critical last mile of connectivity to the investment community. This connectivity has been left by the wayside, and access to long-term focused institutional investors has dissipated. These are the investors companies want as shareholders. Paradoxically, they have become the sell-side’s worst customers (if they are still customers at all). As a result, conferences and non-deal roadshow schedules are dominated by sector specialist investors conducting channels checks and, of course, hedge funds. As many IROs are painfully aware, a wider net must be cast outside of the traditional corporate access world. Here’s where the loss of the legacy institutional equity sales model stings. It was a model built for scale and consistency. It was a sales organization built to sell stories and value propositions.

Repurposing the Institutional Equity Sales Model

We have purposefully built our team over the last five years, consistently hiring highly-accomplished institutional equity sales people with decades of experience and relationships. We are staffed to help our clients with messaging, communications and strategic matters, but our purpose is to act as our client’s de facto institutional equity sales team. Our approach has been embraced by both our clients as well as our friends on the buy-side, who appreciate being shown new investment opportunities and, equally importantly, that there is no implied cost. All we ask for is honest feedback and the opportunity to engage in an active dialogue on our clients’ behalf. It’s a very symbiotic relationship for all parties involved.

Providing feedback and engaging in active dialogue costs the portfolio manager nothing, but adds tremendous value for our clients. It shapes future messaging to proactively address key concerns, and it better enables us to prioritize future interactions and know who to call on our clients’ behalf as they execute on their strategies. We have found that being able to identify the next steps in the investment process is key to maximizing our clients’ time and resources. All too often, our clients lament that they are not sure whether time spent at a sell-side conference was time well spent. While we can’t force anyone to invest in a company, we can certainly help our clients understand their key concerns.