In our previous article we discussed the rationale behind making Elixirr a publicly listed company. However, making the decision was only the first step in the journey…

Swimming against the tide

The news broke that the UK was to head into lockdown just one week before we had planned to start our IPO; many would have decided to stand down, holding off until ‘normal business’ resumed. Although incredibly demanding, we took advantage of this ‘virtual period’, taking the company public in only four months.

Although incredibly demanding, we took advantage of this ‘virtual period’, taking the company public in only four months.

So, at the end of March, not knowing how long lockdown would last, we went full throttle into the IPO process, and:

  1. Ensured all our financial audits were up to date – this is a prerequisite, as is establishing a single share class
  2. Every aspect of the business was scrutinised from a policy and procedure perspective to confirm that the business is a robust and well-managed entity
  3. Conducted extensive due diligence across legal and financial aspects of the business. This was completed with external advisors to unearth any issues or risk – concluding in formal reports
  4. We prepared all key documentation required to become a public company, and other necessary internal changes; this included forming Board committees and putting employee share option schemes in place
  5. After completing these important steps our attention moved to the ‘fun’ part: finding the right set of institutional investors to fund the strategy. In some ways it is quite simple: if you have a good strategy and investors believe you can deliver it, then they will invest. (Then it’s just the small matter of proving this strategy in the months and years that follow!)  

After completing these important steps our attention moved to the ‘fun’ part: finding the right set of institutional investors to fund the strategy.

The process leading to an Initial Public Offering takes anything from six months to a year, or more. As a firm of consultants, we are well-versed in running projects to tight timelines. So we set a target date of July for our official listing.

Due to the lockdown, we conducted the full IPO without stepping into our office, or holding a single face-to-face meeting. While this may have been hard to comprehend a year ago, a purely virtual process actually worked in our favour in many ways…

Productivity highs

  1. Ways of working: Traditionally the IPO process involves countless face-to-face meetings, but the lockdown environment clearly didn’t allow this. With seven advisory firms and up to 15 Elixirr team members (working on the project alongside their ‘day jobs’!) anything that could enhance efficiency was gratefully received. Working virtually meant key individuals were more readily available; with travel time removed, all necessary meetings were held in a timely manner with minimal distraction. Equally, if there was a requirement for an unexpected meeting as a result of an unforeseen issue we were able to react quickly with all necessary parties, via phone or video call.
  2. A streamlined process: The journey to listing requires a great number of documents; this requires collaboration between external advisors and internal finance, legal and commercial senior team members. Usually this documentation would be in physical form, but COVID-19 largely took the requirement away. This again resulted in a more seamless exercise (bringing a slightly archaic process up to speed!).
  3. The pathway to placing: In a typical IPO, an investor roadshow is held, involving the Founder/CEO and others presenting to a plethora of potential investors as part of the ‘book building’ process. This usually occurs in the weeks and months leading to the final placing. We conducted 49 presentations in just 10 days. The ability to do these virtually, removing the need to travel, meant that vital time was saved in the weeks running up to our final deadline. Lockdown also inevitably meant external investors were more readily available – and at short notice. All this activity resulted in an oversubscribed placing.

Challenges to face

Not all aspects of our IPO were smooth; one major challenge was signing off our audit as a going concern. Although Elixirr is (and was) a very low risk from a going concern perspective, this happened at a peak time in lockdown, while uncertainty and confusion were at an all-time high. The industry as a whole was almost at a standstill with signing off audits, given the uncertainty of the economy. The timing of this was extremely painful and posed a risk to our timeline; delays of weeks, or even days, were critical to our final deadline.

Signing documents also presented a challenge, purely due to the volume that required signatures; this created a significant administrative burden – with little support for our General Counsel working from home.

Despite these hurdles, the team managed to come together in person for the pinnacle of the IPO, our actual day of listing on the 9th July; it was an unforgettable day of celebrations.

As we continue to strive forward in our next stage of growth, our next article will discuss the current market more widely, in addition to why we think IPO is right at this point in time for many companies like ours.

The most challenging times often create the biggest opportunities – if you are bold enough to take them. #MSH.

Simon Retter, Non-Executive Board Member:

“The journey to listing can be arduous, particularly for larger corporates. The process risks taking the senior teams’ eyes off the ball on the day-to-day running of the business. The environment we found ourselves in-between March and July actually lent itself to this process very well, where time and focus was permitted to meet a strict deadline.”