When analyst coverage shrinks, what comes next? A new era of IR to serve investors even better.

Let’s face it: for many Finnish listed companies, organic equity research coverage is no longer the norm. And this particularly the case for small-cap or First North companies. A recent Bloomberg article revealed a striking figure: Over the past decade, global equity research headcount has dropped from nearly 4,600 to just 3,000 across the 15 largest banks. That’s 65% of what it used to be.

The biggest reduction? Right here in Europe.

And this shift isn’t just global. In Finland, analyst research ihas shrunk for a long time. Most recently, Arvopaperi magazine just wrote an article about the discontinuation of equity research for some companies.

It wasn’t a scandal. It was a signal.

●      Organic analyst coverage of traditional investment houses is being redirected toward bigger markets than Finland, or larger caps.

●      More and more Finnish companies must rely on paid analysis solely (as there practically is no other option available).  

Which raises a fair question: Can you fully trust analysis if the company being reviewed is also the customer?

This isn’t a new model. But it may raise some eyebrows among some private investors.

At the same time, AI now makes it easier than ever for any investor to summarize reports, benchmark performance, and even simulate investment scenarios. No recommendations required.

The takeaway is clear. The model is evolving. And here’s the good news: so is the opportunity.

Challenges with the current means

For years, IR communication has rested on a core assumption that analysts and financial media are the primary bridge between companies and investors. In today’s market, however, that assumption no longer entirely holds up. 

●      A large portion of OMX Helsinki’s listed companies have no organic analyst coverage at all.

●      Press releases don’t reach investors the way they used to. Some even suggest their impact has fallen to less than a third of previous levels (difficult to measure, I know...).

●      More and more investors now trade via digital platforms, not through traditional banks.

And if you look at trading volume, in many cases private investors, not institutions, provide the majority of daily trading volumes. In fact, in some cases, 50-70% of a company’s share trading volume may come from private investors. And private investors, broadly, including family offices and large individual investors, not just domestic households.

The shift is not about replacing anything. It’s about rethinking.

This isn’t about choosing between analysts and alternatives. Analyst coverage will still play an important role in creating market transparency, but it’s high time to recognize that forward-looking companies now face challenges over how their equity story will be understood on the capital markets.

What we’re seeing is similar to the evolution of the media

Where once 80% of corporate communication ran through journalists, today it may be closer to 20%. The rest flows through owned content, platforms, and direct channels, you name it.

Investor relations is on the same trajectory. Traditional routes still exist, but you cannot any more rely *solely* on them delivering the results you want.

What does this mean for Finnish companies?

For companies, the challenge goes beyond visibility. It’s about trust. Investors still need reasons to trust, to follow, to engage. Only the ways have evolved.

If anything, a modern investor is looking for information that is:

●      clear and easy-to-digest

●      consistent over time

●      credible, not polished

Companies that understand this shift aren’t making more noise. On the contrary, they are building smarter, more structured IR communication for serving investors better.

And these changes can be small, but their impact can be huge.  

More and more forward-looking companies are realizing this shift

More and more forward-looking companies are realizing this shift. This is a call to momentum, because the current landscape gives companies more freedom than ever to build investor confidence in new ways.

Many companies are already exploring what this can look like. Others are ready, but unsure where to begin.

That’s where we step in.

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