𝗕𝗲𝘁𝘄𝗲𝗲𝗻 𝗧𝘄𝗼 𝗘𝗮𝗿𝗻𝗶𝗻𝗴𝘀 𝗖𝗮𝗹𝗹𝘀 𝘄/ 𝗠𝗿 𝗜𝗻𝘃𝗲𝘀𝘁𝗼𝗿 𝗥𝗲𝗹𝗮𝘁𝗶𝗼𝗻𝘀
𝗖𝗼𝗻𝘁𝗿𝗼𝗹 𝗮𝗻𝗱 𝗦𝗵𝗮𝗿𝗲𝗵𝗼𝗹𝗱𝗲𝗿 𝗩𝗮𝗹𝘂𝗲

Control and Shareholder Value represent two simple words that are often at odds for public company executives.

Focusing too much control on details, outcomes, and investor actions often hinders creating shareholder value.

While this may seem counterintuitive, the more one tries to control outcomes, the more likely investors are to question you, and or the more likely an unforced error occurs

𝗖𝗼𝗻𝘁𝗿𝗼𝗹

Public company executives often spend a lot of time wanting to control everything.

Control the last detail of the narrative, financial guidance, and investor reaction.

The problem is that public companies are complex systems made up of countless variables impacting hundreds to thousands of investors.

Letting go is often difficult, because successful public company executives got to where they are by controlling things, being organized and executing.

If the goal is control, then the company should be private, as venture capital and private equity situations typically involve a single owner.

𝗪𝗵𝗮𝘁 𝗗𝗼𝗲𝘀 𝗦𝘂𝗰𝗰𝗲𝘀𝘀𝗳𝘂𝗹 𝗖𝗼𝗻𝘁𝗿𝗼𝗹 𝗟𝗼𝗼𝗸 𝗟𝗶𝗸𝗲 𝗳𝗼𝗿 𝗮 𝗣𝘂𝗯𝗹𝗶𝗰 𝗖𝗼𝗺𝗽𝗮𝗻𝘆

Successful control for a public company comes in the form of the investor base acting in accordance with how management expects them to act in response to the narrative and guidance.

Investors repeat your narrative back to you and others.

Investors accept and model according to your financial guidance.

The company is meeting and exceeding the financial guidance provided.

Success lies in creating a summary level picture of narrative and finance that is not torpedoed by a minor detail or variable

𝗦𝗵𝗮𝗿𝗲𝗵𝗼𝗹𝗱𝗲𝗿 𝗩𝗮𝗹𝘂𝗲

Shareholder value creation involves striking a balance between control and letting go.

The company must control setting the narrative and financial guidance, but at the same time, the company has to let go of control of every last detail.

A public company controls setting a thoughtful narrative, setting achievable financial guidance, and ensuring it has the right, people, processes and systems.

The key is setting the right narrative and guidance, allowing investors to react organically, and then using communication and adjustments to recalibrate investor actions accordingly.

𝗞𝗲𝘆 𝗗𝗲𝗰𝗶𝘀𝗶𝗼𝗻

A public company executive faces a decision:

Do I want control or Do I want to create value?

Once you answer, the rest of your actions will follow accordingly.