Brian Lantier: I’ll allow the panel to introduce yourselves, if you could, and maybe get a little background on your company, and then we’ll jump off from that.
Joe Coveney: Thanks, Brian. I’ll kick things off. So, my name is Joe Coveney, as you may already be aware. I work here at OTC Markets Group. I am the co-head of our EMEA franchise, so responsible for both business development and client service. It’s a pleasure to have worked with all the companies that are presenting today, as well as many others from the region. And, really, my team’s primary roles and responsibilities are helping listed companies from Euronext, NASDAQ Nordic, Spotlight, Nordic Growth Market, etc., increase their visibility, tradability, and compliance with U.S investors. So, the theme for today’s conversation is really just kind of best practices for accessing the U.S. market, and sort of high-level strategies, and I really appreciate the chance to share the stage with the rest of you.
Alexander Lindquist: Hi everyone. My name is Alexander Lindquist. I work at SEB based in our New York office. SEB is one of the leading Nordic investment banks, has been around since 1856, top 100 banks in the world in terms of assets. And so, my responsibility here in New York is to lead our U.S investment banking opportunities, whether that’s doing U.S. dollar bonds, raising equity in the U.S. market, or helping out with M&A cross-border opportunities.
Ken Kraszewski: Hi everyone, my name is Ken Kraszewski. I’m a counsel at Borenius. Borenius is a Finnish law firm with offices mainly in Finland but also in New York and London. My background is in capital markets, having worked both in Europe and in the U.S. Primarily, what I do now in my current role is help Finnish and other Nordic companies raise funds from the U.S. So, I’m a New York-qualified lawyer by training. So, I’m very happy to be here as well. And thank you to Joe for the invitation. So glad to get into this discussion.
Thomas Jansson: I’m Thomas Jansson. I work for NanoCAP, where I’m a co-founder. We do investments within startups or early-stage companies, and then we have an active role as shareholders. One main thing is to help them go to the U.S market, for example. We have been doing this since 2014, so the company has been operating for more than 10 years in this sector.
Brian Lantier: Thank you very much. I think all of your perspectives will be interesting on this question of: when we talk about some of the advantages for Nordic issuers and coming to the U.S markets, coming to U.S investors, what do you see from your perspective as being some of the main advantages? Maybe Alex, go.
Alexander Lindquist: There are an enormous amount of opportunities here in the United States, being the center of the capital markets of the world here. There’re thousands of investors that are potential investors for your companies, right? The key is realizing that diversifying your shareholder base every year, every quarter, is extremely important, right? So, the opportunity really is to meet new investors, learn from them, they’ll learn from you, foster relationships. Too often, companies don’t have enough liquidity. The share price might be a good price, but if there’s not enough liquidity, many investors will not be able to invest, right? But sometimes, if you’re missing one of those two things, you’re kind of limiting yourself in the long term. So, having as many conversations as you can and hopefully improving the trading liquidity of the stock, and just like investing, diversifying your shareholder base across geographies.
Brian Lantier: Ken, what do you see with the issuers that you bring here?
Ken Kraszewski: Yeah, I mean of course a lot of the issuers are attracted by the, you know, the biggest deepest pool of capital in the world, but I think that the ones that I see have the most success really are looking to the U.S. as a platform for growth, as a place where they can make strategic partnership, where they have a huge either retail consumer base or just business consumer base, and they really think about the U.S not as just some place to raise capital, but to sort of position themselves for future growth, for explosive growth. And this is kind of like a bit of a harder mindset to get across to Nordic companies. I work primarily with Finnish companies, and from a Finnish company’s point of view, the Swedish companies are really extremely outgoing. The Swedish Companies are maybe not thought of that way by U.S investors. Finnish companies really need to focus on the growth potential that exists in the U.S and really kind of step out of their safe mindset.
Thomas Jansson: I can agree fully with what you say and everything, but, as you said, to get there, it’s important to focus on the right things. You cannot just go here and think it’s solved itself. You need to have a long-term plan all the time. You need to talk to investors, advisors before you do the first step, maybe. Because otherwise, yes, it will cost money; it doesn’t matter if it’s a low cost or a high cost. But you need to have a long-term plan for your business to grow the business and then of course, if you do that, the investor base is bigger than anywhere else.
Brian Lantier: Piggybacking on that, what’s your advice to some of the companies that you’ve worked with around an IR strategy?
Thomas Jansson: First, you need to find good partners. You need to work with them long term. You cannot just jump around because the result doesn’t come in the first day. And people ask like, is it good to be there? No, it’s not good to be here. You need to be here and work. That’s how you build your success for the long term. And it doesn’t matter if you’re small or big. You need to do it long-term, like get the market to understand your business.
Brian Lantier: Are the disclosure requirements any different for the Nordic companies when they come here to reach out to the U.S investor base?
Ken Kraszewski: No, I mean, if particularly if they’re looking to trade on OTC, no, they don’t necessarily have to have to worry about different disclosure requirements But of course, you know if they are if they’re doing some kind of private offering, then yes, they need to worry about whether they’re talking to accredited investors, talking to QIBs, and there’s a whole, we don’t need to get into all of it, but they should speak with legal advisors before making those contacts, of course.
Joe Coveney: I think the beauty of kind how we operate is the fact that we are a stock market by definition and not necessarily a stock exchange. While we walk, talk, and act like a stock exchange and perform the exact same functions of connecting buyers and sellers of equities, the fact that we’re a stock market and alternative trade system, we get to use this special exemption from the SEC Rule 12G32B, which is unique to companies who trade here on the OTC markets. And that exemption essentially says if you’re public outside the U.S on a qualified foreign exchange, all the Nordic markets have this QFE designation, you can passport your local filings and disclosures, as long as they’re in English, to be public here. So, from kind of a cost a resource perspective, for many companies listed abroad, our market is a very attractive alternative to going through perhaps a more complex or riskier requirements of trading on one of the U.S exchanges.
Brian Lantier: That’s interesting. Ken, you sort of allude to some of the differences between Finnish and Swedish companies. What sort of differences do you see between a Nordic investor base and a U.S investor base that we all know? Maybe Alex is…
Alexander Lindquist: Yeah, happy to take that one. So, I would say the U.S investor base, being that you’re in a totally different time zone, they’re going to have less patience, right, if you’re not kind of locally here, right? So, getting to the minimum bars of liquidity, chances are they’re going to be competing on different conference calls every single day. So, if you have a conference call with some other conference calls that are U.S.-based, they might prioritize the U.S ones. Getting your research out will be more difficult, so having experienced broker-dealers in the U.S that are experts, whether it’s shipping, technology, or energy, trusted investment bankers that have good relationships with investors are going to be key to getting those ideas out to those investors. So, it’s difficult, but it’s definitely not impossible, and the opportunity really is exciting. And like Joe was saying, OTC is a very inexpensive product in the sense that the risk-reward is in your favor, especially if you work hard, have a lot of conversations, be patient, and be consistent in delivering on your goals. Then, yeah, just realizing it’s pretty much the same thing, but at the same time, they’re going to just have less of a patience level in the sense of what they’re going to be willing to invest in, because it’s not locally.
Brian Lantier: Right. Thomas, you might have a unique perspective here, too.
Thomas Jansson: Now I feel a little bit more that here growth is more important than back home. That’s maybe the main thing. If you go here and say, What’s your target? I don’t have a target. That doesn’t work. But back home, it might do that because they look at historical numbers. Here, you need to have a long plan. You need to have pretty high expectations of what you’re going to do because if I don’t believe my business, why should they? So that’s more important, I would say.
Joe Coveney: I also like to just add that I think: be bold, right? Like, you know, don’t be afraid to tell your story when any win should be treated as a big win. So, whether you sign up a small customer or a large customer, right, like there’s a story to be told around that. And I think just constant communication to the market and, you know, regular updates about your execution on the business plan. You know, these are all things that U.S. investors want to hear and want to feel engaged and, you know, the ability to tell your story effectively certainly matters.
Ken Kraszewski: Yeah, I would echo that. I think that a lot of Nordic companies would prefer to maybe just let the numbers speak for themselves, but you can’t really do that in the U.S. You have to be proactive and sort of, as Joe said, know, put news out there for every deal, every new customer.
Brian Lantier: What do you see when you’re dealing with your clients or your investments as some of the biggest challenges that they’re facing when they’re looking to come and talk to U.S investors?
Alexander Lindquist: Well, I think the biggest challenge really is they really want to… It’s just fighting for relevance. Sometimes you don’t necessarily need to rely on the banker to make these phone calls to investors. Just be willing to pick up the phone. If there’s a really attractive investor in your peer that’s very similar to you and similar risk/reward profile, same industry, call that investor yourself. Let them be aware of the opportunity that you have. Provide some links to the videos on your website and strike a meeting. There’s nothing stopping a company from making a phone call. Of course, though, engaging the best investment bankers in that local region and the sector expertise is also going to make that easier. Be bold and don’t be afraid to pick up the phone. I think U.S persons are very open to new relationships.
Joe Coveney: I forget who mentioned it, but they talked about kind being here in New York and sort of the energy, and you know, the desire to grow. You know, while focusing on the macro is certainly important and kind of the general economic environment, geopolitical stuff, all of that should be taken into consideration, but knowing that a strategy in the U.S is a long-term strategy, right? Like not getting afraid of, you know, whether it’s tariffs or a new administration or, you know, wars around the world, all things that are outside of our control and things that are certainly not welcome. But just, you know, have the ability to zoom out and remember that this is a long-term strategy. Your business is for the long-term, and those things that are outside of your control, you know, shouldn’t influence or play a factor in the day-to-day as much as or as scary as it may seem.
Brian Lantier: That’s good. Maybe talk about some of the emerging trends in the capital markets that Nordic companies are looking at and what the U.S investors are focusing on when they’re looking and talking to some of the Nordic companies that you represent.
Joe Coveney: Sweden is a great example. Jason mentioned it this morning in his opening remarks. It’s one of the best IPO destinations on the planet right now. So, I think the Nordics as a whole, the region, has perhaps been maybe underserved from a global perspective, and that’s wrong in my opinion. Long-time leaders in traditional industries like oil and gas or fisheries, or different sorts of legacy-type businesses. But most recently, you can see the diversity of the companies that are presenting here today, right? Like green technology, digital assets, startup aviation, right? These are all fantastic new sectors that are certainly relevant to the U.S. investor, and coupled with the different things that we’ve talked about in terms of strategy today, we’re excited to help bring those companies to the market.
Ken Kraszewski: I think in general Nordic companies have a lot of, there’s a lot to them that is attractive to U.S investors. There’s sort of a great engineering background. There are these new fields like sustainability, clean tech, fintech, health tech that are all, you have a lot of active companies in that sector in the Nordics. Then, just sort of like corporate culture in the Nordics, corporate governance, all of these are at an extremely high level in the Nordics, where U.S investors can’t really find a better destination than the Nordics.
Brian Lantier: Do you find U.S investors value that?
Ken Kraszewski: It would depend on the investor, but yeah, I might say they undervalue it to a small degree.
Alexander Lindquist: Yeah, I agree, totally agree. Corporate governance is extremely high in the Nordic region. Those who are not familiar, basically, if you’re the largest shareholder, you are in charge of who to put on the board. It’s not the CEO who’s in charge of deciding the board. It’s the largest shareholder. Money talks, basically, when it comes to that. If you have the most risk, you should make a decision on who’s going to be on the board. So, it’s a completely different approach to it. And that’s something that you’ve seen a lot of U.S. funds, now popping up, just focused on the Nordic region because they love the corporate governance. The quality of the management is fantastic. I think often in the United States culture, it’s okay to work at a company for two, three years, and then you kind of upgrade your title or salary, and you move on to another company. To me, it feels like Nordic companies are able to hold managements for much longer, and there’s a much more kind of long-term vision there, and it’s obviously better to have a stable management structure.
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