How to choose an investor relations agency for a mining company

The right investor relations agency for a mining company can explain your project to someone who is not a geologist, can show you its work for other listed miners, knows what NI 43-101 and your exchange allow, and is paid in a way you are able to disclose. Most lists of the best agencies are written by the agencies on them. This is a checklist instead: seven questions to ask before you sign, from an agency that expects to be asked them.

First, decide which job you are hiring for

Investor relations for a mining company is three jobs that are often sold as one.

Shareholder communications. The calls, the meetings, the roadshows and the conference calendar.
Disclosure. The news releases, the filings and the technical review behind them. Your counsel and your qualified person own this, whoever else is involved.
What an investor sees. The story, the website, the corporate presentation, the film and the content between news releases.

A traditional investor relations firm is usually strongest at the first. A creative agency is strongest at the third, and most of our own work for mining companies sits there. Know which gap you have before you compare firms, because a firm that is excellent at one of these is rarely excellent at all three.

Seven questions to ask

Can they explain your project to someone who is not a geologist? Give them an hour with your presentation, then ask for your investment story in two sentences. If it comes back as geology, so will your marketing.
Have they done it for a listed mining company, and can you see it? Ask for the live website, the film and the deck, not a wall of logos. Ours are public: the brand, the site and the docuseries for Teako Minerals, and the investor site for Altamira Gold.
Do they know what you are not allowed to say? Under National Instrument 43-101, scientific and technical statements about a material project must be based on information prepared or approved by a qualified person, and the rule reaches your website as well as your news releases. Section 2.3 bars disclosing the gross value of the metal in a deposit, among other things. An agency that offers you a headline about billions of dollars of gold in the ground has not read it.
How are they paid? TSX Venture Exchange Policy 3.4 does not allow compensation based on the share price or on trading volume. Policy 4.4 limits the stock options granted to all investor relations providers to 2 per cent of the issued shares in any twelve months, vesting over at least twelve months. The Canadian Securities Exchange’s Policy 7 has the same 2 per cent limit and the same bar on pay linked to price or volume. An agency that proposes a success fee on your share price is proposing something your exchange prohibits.
Will the engagement have to be disclosed? On the TSX Venture Exchange, retaining someone for investor relations or promotional activity is material: a news release names the provider, the services, the period and the cost, and the exchange receives a filing. The Canadian Securities Exchange asks for a news release naming the provider, the dates, the platforms and the compensation, and it applies whether or not compensation is paid. A serious agency raises this before you do.
What happens between news releases? Ask to see what they published for a client in a quarter with no news. For Teako we built a content system that turns every drill result into media people watch, so the company has something to show in the weeks between announcements as well as on the day of one.
Who does the work? Ask who writes, who designs and who films, and whether you will meet them. Senior people at the pitch and juniors on the account is the oldest habit in the agency trade.

Four red flags

A promise about the share price. Nobody can make one, and nobody honest will.
Paid promotion that does not say it is paid. Canadian regulators named this as a problem in 2018. In the United States, section 17(b) of the Securities Act requires anyone paid to describe a security to disclose the payment and the amount.
Technical claims with no qualified person behind them. If a grade, a tonnage or a comparison to a neighbouring mine appears in a draft, ask who approved it.
A deck that could belong to any company once the logo is changed. If the template is doing the talking, the company is not.

How we start

We start with a discovery of two to four weeks, timed to your next raise or your next release. It ends in a programme you can hold us to. If you are comparing agencies now, tell us about the project and ask us the seven questions.

Questions

What does an investor relations agency do for a mining company?

It helps the company reach and keep the investors who might own its shares. Depending on the firm, that is shareholder communications, such as calls, meetings and roadshows, or the visible side: the investment story, the website, the corporate presentation, film and content. Disclosure itself stays with the company, its counsel and its qualified person.

What is the difference between an investor relations firm and a marketing agency?

An investor relations firm manages the relationship with shareholders and the market. A marketing or creative agency makes what those people see and read. Many mining companies need both, and the two should work from one story.

When should a junior mining company hire one?

Before the financing, not after it. The story, the website and the deck take longer to make than a news cycle lasts, and the time investors look hardest at a company is when it is raising money.