NASDAQ OMX’s Bob Greifeld talks R&D, private markets and what IR wants

This June marked a year since NASDAQ OMX completed its massive acquisition of Thomson Reuters’ IR, PR and multimedia businesses. With that single all-cash $390 mn deal, the exchange operator more than tripled the size of its corporate solutions business, from less than $100 mn in annual revenue to an estimated $331 mn.

Bob Greifeld, NASDAQ OMX
‘We have to understand customer requirements better than anyone’

Considering Thomson Reuters was the world’s largest IR service provider, and with NASDAQ OMX now handling non-listing-related business for around 10,000 companies globally, the deal also transformed the world of investor relations. IR Magazine recently checked up on that transformation in an interview with Bob Greifeld, CEO of NASDAQ OMX.

Why this particular transaction, and why now? What were the intentions behind the acquisition of Thomson Reuters’ corporate services businesses?
It was a natural follow-on to the strategy we had adopted back in 2005. In the post-Sarbanes-Oxley Act era, it was becoming increasingly difficult to be a public company. We saw that part of our mission was to ease that burden. In many ways, Thomson Reuters was the founder of the whole IR services space, so the acquisition gave us great positioning.

Thomson Reuters was seen by some IROs as too big and impersonal. Now NASDAQ OMX is an even bigger entity in the IR space. Is that good for clients?
We’re always evolving and, right now, as we focus on our next-generation platforms with distribution to more than 10,000 corporate customers, we have an R&D budget our competitors can’t even contemplate; it’s probably more than their overall revenue.

We’re also driving right through the whole organization. We’re asking: what does IR want? What does PR want? What about the board of directors? The chief marketing officer? We have to understand customer requirements better than anyone, and we certainly see a convergence between the IR and PR communities.

How do you see the future of investor relations?
It’s clear that information has a way of affecting the marketing department, the executive suite and the IR department in similar ways. As those silos of information get broken down, corporations need a global set of tools with a common infrastructure to span the world and understand it.

That’s where NASDAQ OMX is unique. We have products and services in different niche areas and we’re global, so the convergence of information consumption speaks to our advantage. For example, Directors Desk, which we acquired in 2007, can evolve into a broader management tool given its security infrastructure and workflow, and some of the desktop tools IROs have today could make their way to directors.

Why did you put corporate solutions under your global technology solutions division, alongside market technology? Are IR and other corporate products and services really all about technology?
Outside of the IPO process, we’re relatively exchange-agnostic, so in that way our market technology business has a tremendous amount in common with corporate solutions, and it makes sense to have all our technology in one area.
Plus, there’s a degree of overlap. Some of our corporate customers are financial companies, so they could also be market technology customers, and some of the financial companies we work for could also be corporate customers.

Then there are certain businesses that tend to span both areas, like BWise, a governance, risk and compliance software company that we acquired in 2012. Above all, NASDAQ OMX self-identifies as a technology company; technology runs through pretty much all of our activities.

We’ve been talking about services for public companies but you also have the NASDAQ Private Market now. Considering private firms today can have many more shareholders before having to go public, and considering those shareholders, including private equity and angel investors, are probably more demanding than they used to be in terms of transparency, could private companies be starting to act more like public companies – including potentially using your corporate solutions?
You hit the nail on the head. The answer is a definite yes. When you look at a later-stage private company getting ready to go public, they can certainly use our services, but way before that they could be using our newswire distribution or even our investor websites. Plus, directors at private companies are also concerned about risk controls so our products and services can work for private firms as well as public ones.