INN Blog Posts

The Next Investor Frontier - Looking Beyond the US

January 21, 2013

While in India, Stephen Harper called on Canadian business to look beyond the US for markets, saying that for Canada “to realize its full economic potential, it will have to diversify to countries like India that are growing and expected to grow much more rapidly” than the U.S.

Harper echoes Mark Carney, who said last year, “It’s going to take a number of years before they get back to the U.S. that we used to know - in fact, they are not, in our opinion, ultimately going to get back to the U.S. we used to know.”

As Harper pushes for more trade with India, Carney points to China for growth. And we know that both India and China are playing a bigger role in the mining sector with their multinationals buying more of the deposits that Canadian explorers find and define. Canadian resource companies cover the entire planet, looking for undervalued and prospective deposits. We also have free trade agreements with Colombia, Peru, Chile, and Costa Rica and are close with Honduras and Panama. 

But what about investment in the explorers that are trying to find those deposits?

For many years, the goal for many investor relations programs was to expand the number of shareholders in the US and Europe. And without a doubt, there is still a vast amount of investment potential in these markets —there are even some pockets in New York, London and Frankfurt that know and understand grades, metallurgy and NI 43-101s. But as Carney says, these markets are not growing. And with uncertain economies, the funds available from those markets continue to sit on the sidelines. 

Maybe this is why the Venture exchange has been so tough for so long.

In recent years, we have seen more opportunities for resource companies to connect with investors outside of Europe and North America. Individual investors outside of the U.S. are able to access companies from around the world with a secondary listing on the OTCQX. There have been resource specific trade shows in China and dual listings in South America.

But those who have tried know that addressing this new market of investors is not easy. Finding them, educating them, helping them buy your shares, keeping them informed and engaged - none of this is easy. 

But perhaps it is time for the investor relations side of the business to do what the exploration side of so many resource companies has already done: explore the whole world. The geos have done a good job of demonstrating the potential that exists. 

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