What You Know vs. What Investors Understand

What's this about?

Investors don't invest in what they don't understand, and for AIM and MAIN listed businesses, that understanding starts long before a meeting is booked. The gap between what a company knows and what its audience grasps can undervalue progress and make even the strongest stories hard to follow. Here's why translation, not simplification, is the key to building investor confidence that lasts.

You understand your business completely, of course you do, if you’re reading this you’re likely a founder, a CEO, a CFO, a CMO or a CTO. You know the technology, the market, the competitive landscape, the milestones that matter and why they matter. You know what the numbers mean in context and you have a clear rationale should questions get raised. You know which regulatory announcement last quarter was significant and which was just routine publishing. You know the difference because you’re in the detail and you likely live and breathe it. 

Your investors however, especially the ones you haven't met yet, often don't.

The gap, between what a company knows and what its audience understands, is one of the most consequential communications problems in the growth market and it compounds. 

The more technical or cutting edge the business, the wider the gap tends to be. The wider that gap is, the more likely investors are to misread signals, undervalue progress, or simply disengage because the story feels too difficult to follow.

Bridging that gap is all about translation and strong communication. 

You don’t need to dumb it down, instead, it's about taking the things you know to be true and significant, and expressing them in a way that lands for someone who doesn't have your context. It’s taking your extensive knowledge and condensing it down to be consumable and enticing. 

This is a skill and when deployed correctly, it can benefit companies beyond measure. It requires effort but it’s not an upheaval, it means writing RNS announcements that give meaning to the milestone, it means investor pages that explain the strategy in plain language, it means director bios and content that build a picture of the team's capability before anyone has to ask. It’s these sorts of small details that give your audience greater understanding. I guess it’s the why, that’s commonly the missing puzzle piece. Why does that milestone matter? Why are you the right person to lead this business? Why is your tech more advanced in the market?

In essence, why should your audience care?

The companies that do this well have better-informed investors and they tend to have more loyal ones too. When investors understand a business (like, fully), they're far more likely to hold through volatility, participate in raises, and recommend to their industry peers – and who doesn’t want stable investors?

Understanding is the foundation of confidence and confidence is what everything else is built on.