S3E7 - Elizabeth Librizzi from AllianceBernstein on Demystifying Buy-Side Corporate Access

What is buy-side corporate access, and how is it different from sell-side corporate access?

Mark Fasken: So Liz, for our listeners who maybe aren't as familiar with corporate access, what is buy side corporate access and how does it differ from sell side corporate access? 

Elizabeth Librizzi: So, it's really not that different. And I'll put on my former sell side hat for a second and say, you know, when I was running sell side corporate access desk in my prior life, my suite of clients was 200-300 clients. Now I have the same job. I just have one client and that's AB, and it may be the 200 or so people that are at AB, but the role is very much the same, and that's curating and partnering with our investment professionals to get the access to the corporate community they need to make their investment decisions, which is really no different than what I was doing and what any other sell side corporate access desk is doing. So I would say the audience may be a little bit smaller, and a little bit more unique in terms of just the size of it, but the end product really is the same. 

Mark Fasken: And why has Alliance Bernstein or AB as you say, amongst other firms, of course, created an internal corporate access team? 

Elizabeth Librizzi: I can really only speak for us, why we did it, but I don't think it's that different why some of the other buy side firms have done it. Corporate access is probably one of the newer offerings that the sell side was able to bring to the table in terms of rounding out their offering to their buy side clients. That's typically around a conference, or around a corporate looking to get on the road, and it's not to say that we are not going to attend a conference because we absolutely will. That's not to say we are not going to take a road show when one of our sell side partners is bringing a corporate through town, but very often we are doing our work on the investment side, we have some questions, we want to get access to the company and it's very much a point in time situation versus anything else.

And I would also say that, and we recognize this, corporate access is a finite resource, right? And kind of like what I said earlier, when you're on the sell side, you have hundreds of mouths to feed. So just because a corporate's coming through town at a certain point with one of our sell side partners, that may not mean we're going to get access to them, and we understand that. And so it's really about us taking some ownership. About one, having that engagement when we're looking to have it, but two, and this is, I think, more important, and I want to be very clear: We're not looking to disintermediate the sell side in any way, they have a very important role in this process. But at AB, we are looking to develop relationships with corporates over time, and this is something we're going to own you for potentially years and years to come. And so it's really about developing that relationship with you from the outset, and kind of fostering that as we go through the cycle of our investment process.

Mark Fasken: In some ways, it also, we have said this, I think, on our prep call, it really comes down to your point and being more intentional, like the internal corporate access teams are very intentional about their companies that they are working with and bringing in to meet with the investment team because there's a reason, right? The investment team, one of these groups is doing research, or some sort of background work. It's not just, oh, you're in town. Great. Let's have a meeting. 

Elizabeth Librizzi: I think that's important. It's not about taking a meeting for the sake of taking a meeting. There's a real purpose to why we're asking for that access, whether we're asking for it directly to the corporate, or whether we're asking one of our sell side partners for it, it's very intentional. It's not just for the sake of taking a meeting because I'll say on the flip side, there are oftentimes where we may be targeted. I don't know if that's the right word, but a corporates coming through town. Alliance Bernstein is on their list of investors to see. We won't take that meeting if it doesn't make sense for where we are, in our process with investing in the company, and we'll be very transparent about that. So it very much is coming at both the corporate directly and working with the sell side at point of intent. 

Mark Fasken: And, and so, I mean, coming from the sell side, obviously, you know that corporates rely very heavily on their sell side partners for corporate access and help with marketing and everything, but as you also know, there's been a big shift towards a lot of IROs doing more marketing themselves, taking a little bit more ownership of that, that part of the role. So how would you recommend IROs engage with internal corporate access teams like the team at AB? 

Elizabeth Librizzi: So it's very important for me to convey to the listeners that we are not here and by we I mean my internal team. There's three of us, we manage the process globally out of New York. We are not here to disintermediate the corporates from the investors directly or the sell side from the investors directly. I view us as a conduit. AB is 31 teams globally, and many of whom have overlapping interests, and we very much partner with each other and share meetings. And often I find that a corporate may not have all of the touch points internally. So, if nothing else, my team may be able to help that IR meet five or six other people within AB that are focused on their name, that they may not have met before. And with that again, goes to my earlier point, developing that relationship that longer term relationship.

Mark Fasken: If a corporate was looking to get a meeting with an investor at AB, and let's say AB is not currently a holder. Is there a higher likelihood of that corporate getting a meeting if they went through the corporate access team versus, you know, right to the investor or through the sell side?

Elizabeth Librizzi: I would say, I don't want to say a higher likelihood, but if an IR has one touch point, and only one touch point, and that's an investor, maybe that's not the right touch point, and so that may get lost in their email. Very unintentional. We all I think if we both look at our emails right now, there's a lot in there and we're going to miss something. My team, we have a centralized mailbox, and that's all we see. And e're sectorized, so the team is actually focused on specific sectors. And so each individual team member is also tasked with working with the individual teams on their priorities. So I don't want to say there's a higher likelihood. They will always get a response, whether it's yes, we'll take a meeting or no, we won't, when they come to our team. And additionally, we'll also probably be able to direct them to somebody who may want the meeting if they went into the wrong person initially, I'd like to say, and again, it goes back and I keep harping on this, so apologies. It's a relationship that we're looking to build over time. So if we ever come back and say no, it's typically not no, period. It's probably no, not right now. And here's why. And so we'll never let an email that a corporate sends into us die on the vine. We'll look to get back to them in some way with some type of feedback as to why a meeting may or may not be of interest to us at a specific time.

Mark Fasken: Well, I think that's hugely valuable because I will say that to your point. I mean, investors and everybody's getting a lot of email, but I will say that many of the IROs that we talked to, they talk about outreach and things that they do, and a lot of people talk about how low the response rate is, right? And so I do think the fact that your team is far more likely to at least get back to them and say, "Hey, you're not right now", or "here's the person you should talk to", or "these are some of the reasons that it maybe isn't a fit size or sector" or what have you, it's super valuable for the future outreach, right? Maybe in a year or two, they come back and say, "Hey, something changed and we're a better fit". And so I do think that that is extremely, extremely helpful. I think that is, one of the benefits of working with a internal corporate access team is that kind of open feedback and that longer term relationship and to that point, what would you say are some of the other benefits of working directly with the corporate access team at a firm like AB?

Elizabeth Librizzi: Yeah, so again, I think that the firm wide connectivity is very helpful. We also have a purview into how our investors will be working with the street. And by the street, I mean the sell side in the coming months. So very often a corporate will say to me, we can't do this meeting now, but we're going to be in at so and so's conference in September, my team is positioned to say, you know what, we actually don't have anybody going to that conference. So perhaps we can find another time for us to connect. And it's also important for me to convey my team is not here to make the corporate lives more difficult from a scheduling and logistic standpoint, we will always partner with the sell side firm that we work with. But candidly, there are many firms that we don't have relationships with, and I'll also be (and my team), importantly, will be very forthcoming with that. So when a corporate comes to us and says, we're going to be marketing in New York or London with so and so, if we work with that firm, great, we'll look forward to partnering there on a meeting. No problem. But if we don't work with a firm, we'll also be very forthcoming with that. Because, look, we understand there's a commercial aspect to why a sell side firm is marketing this trip to their, you know, this meeting to their investors. And if we're not a client of theirs, it doesn't make sense, and we recognize that, we don't expect to get a meeting in that regard. But I also think it's important for the corporate to get that feedback, because there are a lot of legs of the stool that maybe we're all not immediately focused on. So, I think, I may have been a little long winded their apologies, but I think , the benefit of having a relationship with our centralized team, is really having a purview into probably the broader scope of how we're looking at how we plan to engage in sell side events in the coming months. 

Mark Fasken: Do you find that a lot of the corporates and IR teams that you're working with are engaging with your team in that way? And they are asking, "Hey, we're owned by this fund within the firm.Are there other groups that we should be speaking to?" Are they actually like, getting the benefit of that, do you think? 

Elizabeth Librizzi: I think so. It sounds horrible to say, COVID sort of was a blessing and a curse in that way. I think it forced the industry to rethink how they were engaging, the forums they were engaging.

And I think the fact that maybe some geographical barriers came down, time barriers came down and I think that exposed a lot of investors and a lot of corporates to each other because, candidly, what else were we doing? There was very little to do. I think, yes, I also think forums like this where you, and I so appreciate it, give me the opportunity to talk about what my team is doing, more and more opportunities like this come up. I think the corporate community realizes we're here and we exist, and we're actually here to be helpful to them. So to answer your question, I am seeing a lot of, I guess I'd call it reverse inquiry coming into us about engaging with our investors in some type of way. We think it's great because again, it's a relationship business and we think that's how relationships are built, you know, we don't always feel like we need to sort of rely on a third party and by the third party in this case, I mean the Sell side to help build that relationship, I think it's something we can do ourselves too. And that's what we've so appreciated again, forums like this, giving us the opportunity to talk about what we're doing. 

Mark Fasken: Absolutely. Yeah, when I, when I was asking a question about whether people are getting the value, I was just to clarify more asking, I don't I'll say myself feel as though all IROs obviously have a full understanding of the value of working with corporate access teams. I think a lot of the time it's like, when do I email them? When do I not? And so I think this will be super useful for them to understand. A lot of people are saying that corporate access teams are also there to be sort of like advisors, so what is the best way to engage with our firm? And what's the best way to work with us, which is obviously super helpful. 

Elizabeth Librizzi: And look, our clients are our internal counterparts, so the corporate should never feel like by emailing us, they are doing a disservice to the people that they already have connections with internally. Invariably, we're going to go to these people and say, so and so reached out, they're coming to New York, they're coming to London, do we want a meeting? We don't keep anything from them. So typically what we find is often an IR is reaching out to an investor and they're reaching out to us as well. And that's perfectly fine because we all, we're all talking to each other. We're all partners in this. 

Mark Fasken: You talked about conferences just on this last question, as you were talking about what conferences are we going to be going to which may be not be going to. There's been a fair amount of discussion about around some buy side conferences, and so are you seeing a rise in those buy side conferences? Are there buy side conferences that people should be particularly aware of? What is your perspective on that? 

Elizabeth Librizzi: There are, we've taken part in a couple that we've sort of curated ourselves. And so we're taking the approach that, and I should take a step back. Our investors find a great deal of value in a sell side sponsored conference, my team doesn't have the bandwidth,  or the logistical ability, quite frankly, to replicate a sell side conference. There's a huge amount of value in getting a critical mass of people that are focused on the same sector together. So, we can't replicate that, we don't want to. The approach we've taken is working with our investors to find niche topics that are very relevant to our immediate focus, and curate an event around that. So, for example, we last year did an inaugural small SMID conference. Small smid cap is a very important part of AB's investment structure. We have a couple of teams where that is their primary mandate, and I don't think I'll be saying anything surprising to any of the IR professionals when I say, sometimes it's a struggle for that market cap to get a full day of marketing when they come into a city.

We partnered with another buy side firm to create an event solely focused on that. It was a great event, and we'll replicate it again this year. We brought another buy side counterparty and to do that with us, and again, it's a niche in the market that we're focused on, that may not be a commercial opportunity for the sell side. Earlier this year, we also did an energy transition conference. Very topical for us at the time, and we were able to bring together 20 companies over 3 days. We partnered with 2 other buy side firms, where that was thematically an important topic for them as well. Will we do it again next year? Maybe not, because I'm starting to see a lot of other energy transition conferences pop up on the sell side, and that's great, that's great, so go there. So we're looking for kind of dislocations in the marketplace and focusing on that. I don't see us trying to replicate a tech conference or a healthcare conference, at least now, that could change. But we're really focused on dislocations in the marketplace.

Mark Fasken: And I'm assuming, though, when you're doing those, you're looking for sort of these nichey topics, as you said, so they could be changing all the time. But again, you're very intentional as a group about what are the topics that we care about right now. And then I assume also, what are the companies that we want to be there, because they're, you know, very knowledgeable in the space or leaders in the space. And so you're sort of handpicking some of those groups. I assume that's also the benefit of having a relationship with a corporate access team, you know, you're on the radar when those conferences pop up. 

Elizabeth Librizzi: Yeah, look, I think the small SMID one is here to stay. I think that's something that at least from our perspective, and the buy side partners that we have teamed up with, it's an important topic and important thematic investment thesis that will continue to resonate with us, that’s here to stay. I believe, at least, that's the plan. And to your point, the roster of companies that are invited may change from year to year. We obviously want critical mass, we want the companies to have a great experience when they're here. If it's just one host that has interest in meeting with them, that may not be a great use of the corporate's time, and we'll try to figure out another way to work them into our marketing plans. But yeah, we will absolutely target specific companies to attend these events. Again, so they have a great experience. 

Mark Fasken: Another benefit that I feel exists in working with the buy side corporate access team, and this is something that you had mentioned to me on our sort of prep call is feedback, right? I mean, I think a lot of corporates, a lot of IROs spend a lot of time marketing and sometimes we're left guessing, how did that go? What? What do people think? And so I won't answer the question for you, but you've come from the sell side, you've experienced feedback and what that looks like from a sell side perspective.: I'll speak for myself and say a lot of corporates really struggled to get it regardless of who set up the meeting. So how does the buy side corporate access teams approach to feedback differ from that of the sell side? 

Elizabeth Librizzi: Yeah, that's a great question. And one, even here, being on the buy side for almost five years, we struggle with a little bit. I think it goes back to what I said earlier about the relationship building. If a corporate Has a meeting with AB, whether it's in our offices or virtually at a conference, and they come away and don't have a sense for how that meeting went, I think our investors would be disappointed. They prep pretty intensely for these meetings. And so I like to think there is a really good sense of when they come away from the meetings, how it went. That said, there's always an element that may be a little more constructive and may want to have a follow up or a one on one. And I think the buy side's reticence to sharing that with the sell side is, and I understand, this now that I'm putting on my former sell side hat, we would ask for anonymous feedback. I'm not sure, and maybe this is a rhetorical question for your listeners and they can, you know, come back to me with their answers, but I'm not sure how helpful anonymous feedback is. Because, I suspect you'd want to have a real understanding for the meat of what that feedback is. So very often, our investment professionals will do a follow up with IR directly. Particularly if there's something a little more constructive, that type of takeaway from the meeting, and I don't know that we would want to share that with the sell side. We don't know what happens with that. And it goes back to the relationship building between us and the corporate, and I think us sharing that feedback, good or bad, works towards building that relationship. And so I think we would much rather do that on a 1 to 1 basis. Also, when a corporate is being hosted by the sell side, we have a no broker policy, so brokers aren't in the meetings, and that's by design, quite frankly, and so again, it just all ties back to us having that one to one communication with the corporate, which is so important as we build that relationship over time.

Mark Fasken: And so I think it sounds to me as though you have a bit of a better chance of getting more direct, comprehensive feedback from the buy side if you're working with them directly, if you're coming through the corporate access team, it sounds like your team also sort of help to set that up, right? You'll sort of help if if there's a question, a group could come back to your team and say, Hey, we feel like it would be really helpful to get a little bit of feedback and you could help to set that up potentially. 

Elizabeth Librizzi: 100% and that goes whether we set up the meeting directly, or the meeting came to us through the sell side. Very often when the sell side does come to us for feedback, we will say we'd prefer to go to the company directly. 

Mark Fasken: So what was the biggest surprise for you going from sell side to buy side corporate access?

Elizabeth Librizzi: The biggest surprise was that it wasn't a surprise. I thought it would have been a little more eye opening and it was, it definitely was. Building something that wasn't here before, was a lot of fun and it continues to evolve. COVID is sort of, and the pandemic has sort of had that evolve at a different pace than I thought. But sitting down with all of our teams and understanding their pain points and recognizing that they were not so different than the pain points I was hearing when I was on the sell side. And so being able to develop a process because, like we talked, I was on the sell side for a long time and I was on the sell side in a variety of roles. I was a salesperson. I ran corporate access and for me, those relationships are key. And so bringing in somebody that could be viewed as a disintermediary and a threat to that relationship, I was very cognizant of not being that person. And so how could I develop our process that everybody wins, and and I say it flippantly because not everybody wins, but that was really kind of how I wanted to develop this. And I think we've gotten pretty close to where everybody feels we've put something together where, we can see the benefits of what we've tried to do, and not at the expense of people's individual relationships, whether it be with the sell side or the corporates directly. We've taken a lot in house over the last couple of years more than I would have thought. And again, I think the pandemic sort of spurred that a little bit, and also, I think, recognizing that there is a willingness from the corporate community to maybe speak with us off cycle and by off cycle, maybe not when they're marketing with a sell side firm.

Mark Fasken: I think that a lot of corporates like the idea of speaking off cycle and going direct, but probably aren't always sure exactly how to go about it. And so that actually leads me to my next question. What would you say are some of the biggest misconceptions or maybe the biggest misconception as it relates to buy side corporate access? 

Elizabeth Librizzi: That we are disintermediary. I think that was, and look, as a former sell side or when these desks started to emerge and I was on the sell side, I was shouting that the loudest, and I just didn't see how there would be room for everybody at the table, and there very much is, because it's a very different offering, and it's a very different ask.

I think the sell side has been really surprised, that coming out of the pandemic, our investors are asking for more and more group meetings at their events because they've been missing that connectivity, kind of the buzz in the room type of situation that you get from a group event or a conference, and we can't replicate that, we can't replicate the group event. I actually tried during the pandemic to see if I could partner with some buy side firms that would want to do that, and it was a tough call, and so we realized that probably wasn't worth pursuing. But I think the biggest misconception is that we are here to disintermediate either the sell side from the investors, or the corporates from the investors, and that's very much not the case. I view us as a conduit. You know, the traffic cop that sits in the middle and directs people to where they need to be, at the time they need to be there. 

Mark Fasken: There's a ton of really good points that have come out of this that I think are helpful to summarize. I liked that you used the word conduit because I also think that there is a perception that the corporate access team is like a they're the gate, the gatekeepers, which to your point, it's like, well, in some degrees we are in that, you know, email us, we'll give you feedback on whether we think it's the right time or not, but we're not saying, no, we're just telling you we're focused on something else right now, and I think that that's very, very useful. I do think that idea of the conduit and like the connectivity across the teams is super helpful. Cause I think, you know, a lot of IROs, as you probably know, or are they're very focused on like, let's get new investor, new investor, new investor, and sometimes it's like, but you already have AB and you've got this one fund, while there's like five other funds, maybe spend your time on building out that that relationship, which is great.

The events, streamlining the process, the value of the feedback that your team and the investors provide I think are all super useful. One thing that jumped out to me in this conversation and in our sort of tech call, was that your team can really act like that advisor, in some respect, right, on the best way to engage with AB, and that long term relationship I think is super useful.

Elizabeth Librizzi: That was my hope when I came over, I'm pleased to say that's really what we've been able to implement. As we do more and more on our own, and again, not at the expense of the street, just sort of where people's priorities are falling. I feel like we continue to develop that cohesive relationship both internally and with the corporate community that makes it a little more fluid to deal with us.That's the hope. We're a complex organization. We recognize that, and my team is here to really try to demystify that as well. 

Mark Fasken: Well, I hope that this episode demystifies a little bit more about buy side corporate access. Yeah, me too. And hopefully, well, I hope that your team gets a bunch of emails after this podcast goes live.

Elizabeth Librizzi: Yes, but we are completely accessible. I think we're all on LinkedIn too. So feel free to look for us. If you have any questions, we're always happy to help. 

Mark Fasken: Awesome, Liz this has been great. Thank you.

Elizabeth Librizzi: Thank you for having me. It was great.

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