Analysts misread companies that make money in more than one way. A short video can explain your business model to analysts, as long as it follows the money and matches the filings.
To explain your business model to analysts, show them how money moves through the company. A short explainer video can trace where revenue comes from, what it costs to deliver, and where the margin lands. Aim it at the one structural question the market keeps getting wrong. Then tie every figure on screen to a public filing.
Why do analysts misread your business model?
Analysts model a multi-segment company the way they understand it, and they usually understand the simplest line best. Picture a company with a subscription line, a services line and a hardware line. It reports all three, yet the model often treats the whole company like its most familiar segment. As a result, the valuation rests on the wrong set of comparable companies. When the gap persists, it can contribute to a conglomerate discount. More disclosure rarely fixes it, because the problem is structure rather than data.
When is a video worth more than another slide?
Make one when the misreading is structural and keeps coming back. For example, the same question about how the segments connect may surface in every earnings Q&A. In that case, a slide has already failed to fix it. An explainer also earns its cost when one structural point has to work in several places. Those places include the Investor Day, the roadshow, the IR site and earnings materials. However, skip it for a point the CFO can settle in one sentence.
Slides struggle here because a business model is a sequence. A customer signs up, pays, renews and expands. Each slide shows one still frame of that sequence, so the presenter has to narrate the motion between frames. Animation, by contrast, shows the whole loop in order. That is often the clearest way to explain a business model to analysts in the time they will actually give it.
An Investor Day or roadshow gives management limited time to make a structural point stick. With an explainer, the company makes that point once and precisely. Afterward, it can reuse the point everywhere investors look.
Should the explainer be animation or live action?
Use animation for the model and live action for the people. Most strong explainers combine the two. First, a leader frames the question on camera. Next, animation walks through the mechanics. Finally, the leader closes with what it means for the investment case.
| Use animation when | Use live action when |
|---|---|
| The subject is invisible: a revenue flow, a platform, a contract structure | The proof is physical: a plant, a product in use, a customer site |
| Numbers need to build or connect on screen | Credibility comes from a person: the CEO, a customer, an engineer |
| The visual must match the deck and the website | The audience needs to see scale or place |
What should analysts see in the business model animation?
Start with the one question the market keeps getting wrong, and answer only that one. The simplest way to explain a business model to analysts is to follow the cash. So build the scenes in the order money moves.
- The customer: who pays, and for what.
- The revenue streams: how each line earns, and how the lines connect. If one stream feeds another, such as hardware that drives subscriptions, show that link. It is usually the thing investors miss.
- Cost to serve: what it takes to deliver each stream, at the level of detail the filings support.
- The margin and the cash: where profit lands, and how the company reinvests or returns it.
- Direction of travel: the mix shift management is guiding to, stated exactly as the company has stated it.
Give each scene one idea. A scene that carries two ideas usually needs to become two scenes. Otherwise, one of those ideas belongs in the deck’s appendix.
How do you keep finance and disclosure counsel comfortable?
Lock the numbers before anyone animates. Every figure on screen has to match the filings, or analysts will get numbers they cannot reconcile. A changed figure after animation means rebuilding every scene it moves through. That is why late changes cost far more on video than on a slide.
Build a source sheet first. It lists every figure, label and claim in the script, with the filing or release it comes from and its date. Finance and disclosure counsel then review the script and the source sheet together. After that, they review the style frames, which are the handful of still images that set the look. This order keeps legal review on words and numbers instead of finished motion. With the source sheet in place, the video can explain your business model to analysts using only figures counsel has cleared.
Treat forward-looking statements with the same care they get on stage. State them exactly as guided, and attribute them to the company. Also, if the video will play outside the live event, ask counsel how the company’s cautionary language should travel with it.
What will production need from IR and finance, and when?
Production moves through six stages, and IR and finance matter most at the script and the animatic. The order protects the schedule.
- Script: written with the CFO and checked against the source sheet.
- Style frames: a handful of still images that set the look.
- Animatic: a rough, timed version built from simple drawings and a scratch voiceover. Pacing problems and wrong figures are cheapest to fix here.
- Full animation: the finished motion, built on the approved animatic.
- Voiceover and music: the final narration, score and sound design.
- Captions and short cuts: the subtitled master and the single-scene versions.
Projects usually slip when counsel first sees the work at full animation. So book legal review at the script and at the animatic, and late changes stay small.
How should the explainer connect to the deck?
Use one visual language for both. Give each segment the same name, color and chart style in the video and on the slides. Otherwise, an analyst who sees a teal services bar in the video and a blue one in the deck has to stop and reconcile them. That pause costs attention you need elsewhere. A shared system lets the deck and the video explain the business model to analysts in the same terms. Our guide to why an Investor Day deck has three jobs covers how the slides themselves should carry that system.
How do you get value from it after the Investor Day?
The explainer should outlast the day it premieres. Analysts who pick up coverage later will need your business model explained too, and the video can do that work for years.
- Post it on the investor relations site and in the Investor Day archive, next to the deck and the replay.
- Cut single scenes into short versions for earnings, roadshow meetings and social posts.
- Add captions, so the film works with the sound off and meets accessibility expectations.
- If it plays automatically on a web page, give viewers a way to pause it. The W3C’s accessibility guidelines call for a pause, stop or hide control in that case. The rule applies when moving content starts on its own, runs longer than five seconds and plays alongside other content.
What do companies get wrong when they explain a business model?
- Animating the deck. Slides moved onto a video timeline keep all their density and lose the presenter who made them readable.
- Trying to explain everything. A four-segment company does not need a four-segment explainer when only one connection confuses the market.
- Designing before counsel approves the script. Legal review then lands on finished frames, where every change is expensive.
- Building it for one event. An explainer that plays once at the Investor Day and then disappears wastes most of the work behind it.
What do sophisticated companies do instead?
They treat the explainer as part of the equity story’s infrastructure. The CFO helps write the script, and the visuals come from the same system as the deck. The team also plans the short versions before production starts. Our design studio builds animation and presentation design as one system for that reason. When the video, the slides and the website share one visual logic, investors learn the model once. After that, they recognize it everywhere. It is also why the explainer belongs in the Investor Day production plan from the first planning meeting. That is how you explain your business model to analysts once and keep the explanation consistent wherever they look.
The explainer brief
Settle these six decisions before anyone designs the first frame.
| Decision | What to settle | Owner |
|---|---|---|
| The one question | The structural point the market keeps getting wrong | Investor relations and the CFO |
| The audience | Analysts, retail holders, or both | Investor relations |
| Sources | Every figure tied to a filing or release, with its date | Finance and disclosure counsel |
| Visual system | Segment names, colors and chart styles shared with the deck | Design lead |
| Formats | Full version, short cuts, captions, and a still for the deck | Producer |
| Home | Where it lives after the event, and who keeps it current | Investor relations |
Frequently asked questions
Scope it by scenes rather than seconds. Give each scene one idea, and let the whole film answer one question. That keeps the cut short enough that analysts will watch it twice. If the structural point needs many more scenes, the question is probably too broad. So narrow the scope before you speed up the pace. A rushed explainer leaves analysts with the confusion it was meant to fix.
Can we reuse the business model explainer in a follow-on offering roadshow?
Usually you can, after a review. Counsel checks roadshow material against the registration statement, so they will confirm every claim and number before you reuse the explainer. Plan for that review instead of assuming the Investor Day version carries over unchanged. Build the source sheet so your team can update it for the prospectus without reopening the animation.
Who should narrate a business model explainer?
A senior leader’s voice signals ownership, and a professional narrator adds polish. Many companies put the CEO or CFO on camera for the opening and closing. A narrator then handles the mechanics in between. That approach also keeps the executive’s time on set short, which makes the shoot easier to schedule around earnings.
Does an explainer replace the CFO’s presentation?
It should not. The explainer carries the mechanics, which frees the CFO’s time for what only the CFO can do. That means guidance, trade-offs and answers to hard questions. The two work best when the CFO refers back to the explainer’s visuals on stage, so the audience connects the numbers to the model.
How do I justify a business model explainer to the CFO?
Make the case on reuse and on time. One explainer can serve the Investor Day, the roadshow, the IR site and earnings materials. Its cost therefore spreads across every place investors meet the model. The video also returns stage time to the CFO. It keeps the explanation identical every time investors meet it. Frame it as an asset the company owns rather than a one-night expense.
Is there one part of your model the market keeps getting wrong? Talk with our team about turning it into a short explainer that works on stage, on the webcast and on your investor relations site.
