Wall Street Week is back. No, not on PBS, its home for 35 years, but streaming online courtesy of Anthony Scaramucci of SkyBridge Capital. SkyBridge has billions invested in activist hedge funds and activists feature prominently in the early episodes of Wall Street Week. Jeffrey Smith (Starboard Value), Carl Icahn and Barry Rosenstein (Jana Partners) are recent guests.
Online TV is the newest channel to be taste tested by the hedge fund industry in its quest for alternative ways to get its message to investors. In general, blogs, video, Twitter and LinkedIn are underused media for hedge funds, despite the fact that hedge funds are critical of the state of traditional media. According to the Wall Street Journal, at the Ira Sohn conference, Barry Rosenstein of Jana Partners lamented “the media covers activist campaigns like political campaigns, focusing on the horserace rather than on the substance of their suggestions.”
That’s the reason the industry, particularly activists, need to pay attention to new media. It provides the manager the ability to control the message, communicate complicated ideas (concepts that do not lend themselves to short form journalism and sound bites) and create a permanent searchable record that can be accessed by anyone, including journalists, researching a company or idea.
The benefits of new media are not lost on activists. Carl Icahn is the activist most committed to new media. Years ago, he hired a Reuters reporter to be his blogger in residence. Recently, he relaunched his blog under the moniker Shareholders’ Square Table. @Carl_C_Icahn is also active on Twitter. Pershing Square is famous for its live town halls.
Success in digital media (or social media, or new media or whatever you want to call it) hinges on engaging with the market on a topic that has lasting importance/interest and being consistent about discussing it across multiple channels. No hedge fund manager is doing this effectively.
Icahn has the right idea, but his commitment to the corporate governance mantle targeted by Shareholders Square Table comes in fits and starts. In November 2008, Pershing Square told investors it was “important for the hedge fund industry to come out of the shadows and defend the importance of our work.” Less than a year later, Pershing Square reversed course, telling investors “we will do our best to fade into the sunset as far as the media is concerned.” Most other activists focus only on the tactical requirements of their campaigns and pop in and out of the public sphere, accordingly.
Is it any wonder, then, that so many journalists and other influencers are unconvinced that activist hedge funds are a productive, corrective force in the capital markets.
A year ago Anthony Scaramucci suggested that an activist can usurp Warren Buffet as the preeminent voice in the market for good governance and how to create value for shareholders. That opportunity still exists and, with Wall Street Week, Scaramucci gives activists yet another platform with which to convince people.