Exclusive: Robinhood-owned Say launches shareholder messaging

Say Technologies, a Robinhood subsidiary, is launching a new messaging feature that enables public companies to send tailored communications directly to retail investors within its network, and allows them to respond.

Why it matters: Newer trading apps, including Robinhood, Public and WeBull, are all competing for younger investors, and building ways to connect companies directly with shareholders.

• Individual investors — through retail and private banks, wealth managers, and self-directed accounts — are expected to dominate global investing by 2030, making up more than 61% of worldwide assets.
• That necessitates a shift toward more multi-channel, virtual and conversational communications, a report from consultancy Indefi concluded last year.

How it works: Right now, there are about 50 companies that compensate Say, based on their size and depth of engagement with verified shareholders.

• Existing features like Q&A and shareholder proxy voting aim to gather feedback. The new messaging function can build a better direct relationship between companies and their shareholders.

Our thought bubble: According to Alexander Lebow, co-founder and CEO of Say Technologies, retail investors generally tend to be more pro-management. Therefore, companies that engage with shareholders could mobilize that base against activists proposals.

What they're saying: "We don't take sides ... we're on [a] multi-decade project ... to totally reconstruct the shareholder communications infrastructure," Lebow tells Axios in an interview.

• At the same time, Lebow said that Say has also discovered that public companies view new forms of engagement as "interesting in the activism defense world," because of how costly attacks can be.
• "These are existential situations for the companies. And we have access ... to not just to get the message out to large numbers of shareholders, but get them to vote," he said.

The big picture: Because Say's platform enables voting and messaging in one place, the ease has already proven successful in driving retail voting — "the Holy Grail of retail engagement," according to Lebow.

What to watch: Millions of investors have used Say's proxy voting and Q&A services, and the company's APIs mean "other brokerage platforms, whoever wants to incorporate our experiences in [their] app, can do so."

Go deeper:

• CEOs are finding new ways to court and communicate with retail investors