In 2016, the largest fintech acquisition in Chicago was the purchase of 3Points client OptionsHouse by E*Trade. While the addition of OptionsHouse strategically filled a gap (active options traders) for E*Trade, and the acquisition was driven by their management team’s ability to build an exciting and dynamic business, the tactical leveraging of PR — while perhaps an easily overlooked aspect — we think also served as a key driver of the deal. We know, because 3Points was there for many steps along the way and saw firsthand how a strong PR campaign can help an enterprise command top dollar in an acquisition.
3Points began working with a predecessor of OptionsHouse, tradeMONSTER, as one of our first clients. We started small with them, and the relationship grew as their business did. We were intimately involved in the development of the business, so much so that our principal, Drew Mauck, created their tagline (“Proactive Investing”) and co-invented a first-of-its-kind product innovation in “tradeSHARE.” This feature allowed users to share trade details on social media. (Yes, we assert that it was the first social media “share” button on a trading platform.) The teamwork deployed to create an exciting brand led to media coverage for tradeMONSTER, including a very detailed and colorful feature in the Chicago Sun-Timesabout six months before the company’s acquisition by General Atlantic and subsequent merger with OptionsHouse.
Lessons Learned in Building the Brand
Our success with tradeMONSTER / OptionsHouse taught us several important lessons:
- tradeMONSTER and OptionsHouse weren’t the first or only companies in their space. In fact, there were a number of other online options trading platforms, and this made crafting and delivering a strong message all the more important. In a competitive situation, having a clear and distinctive message that is delivered consistently can make all the difference in distinguishing you from the pack.
- A successful PR campaign delivers your message and amplifies that message in a way that generates more power for your brand. When it works, a good PR campaign raises your company’s profile among everyone — potential acquirers and investors included. For OptionsHouse, we saw this happen through powerful media placements, such as a Wall Street Journal article on the addition of credentialed CTO (and all-around good guy) Lance Braunstein, and top-3 rankings in the Barron’ssurvey of online brokers in 2015 and 2016.
- A good PR agency is your partner and can help beyond the three pillars of earned, owned and social media. In the case of tradeMONSTER / OptionsHouse, 3Points helped in creating taglines and unique, differentiating services — à la “Proactive Investing” and “tradeSHARE.” While your PR partner certainly won’t execute all of the day-to-day, down-in-the-trenches activities (i.e. product development, direct sales) that lead to core success, they can nevertheless be much more than passive creatives that only do the minimum to meet their commitments. At 3Points, we become immersed in our partners’ businesses, spending time at their locations and learning everything we can about what makes their businesses tick.
- Once your PR work has helped you become part of the public discourse, it can create a frenzy among potential investors — they all want to get in while it’s hot, and they don’t want to be beaten to the punch by rivals. Now, more than ever, it’s important to keep on delivering for the brand. As the business faces an ever-changing landscape of ups and downs, a good PR agency will learn, react and adapt to the changing conditions. It’s far too often that early momentum is squandered and lost by a lack of follow-through and adjustment. A savvy PR partner will know how to capitalize on and amplify success in a way that will create interest in your company and certainly puts the market on notice.
Pulling together the recipe for success
Many factors go into determining whether a company is able to attract an acquirer, with growth, a unique product offering and a stellar ability to execute being at the top of the list. As important as all of these factors are, however, the addition of a comprehensive and powerful communications strategy may well be the deciding factor between a good business and a great one — one that is able to command a premium in the market. Just as a little bit of flour can pull together a sauce for a top chef, the application of a robust PR and communications plan can help an entrepreneur create an exceedingly successful company that secures top dollar in an acquisition.
If you have any questions about our experiences with acquisitions or about our PR in general, please email us at email@example.com or DM us on Twitter.