What Do Public Relations Firms Do? 

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In our ongoing “back-to-basics” blog series defining public relations and investor relations, this post dives into the essential functions of PR agencies and the value they bring to clients.

At its core, a public relations firm helps businesses, brands and organizations shape their reputations and build relationships with diverse audiences—including consumers, customers, partners, investors, and legislators, among others.

Public relations services can vary widely depending on the client, objectives and budget. Below are some common tasks that PR firms typically handle:

  • Key Messaging: Developing central talking points that guide all communications with specific audiences. Each stakeholder group receives tailored messaging.
  • Media Relations: Securing positive media coverage through press releases, media pitches and by fostering relationships with journalists and media outlets.
  • Media and Presentation Training: Coaching individuals to effectively communicate with the media or deliver a presentation through specialized on-camera training, coaching and analysis.
  • Brand Building: Monitoring public opinion and sentiment and working to enhance or repair client reputations through proactive communication strategies.
  • Analyst Relations: Connecting clients with industry analysts to gain valuable endorsements, improved market perception and increased trust from potential customers, investors and partners.
  • Crisis Management: Navigating crises by managing communications among all stakeholder groups during challenging times to protect an organization’s reputation and minimize negative impact.
  • Digital PR and SEO: Creating and managing content for digital platforms like social media, blogs and websites to engage with audiences, while using SEO strategies to increase visibility and engagement.
  • Event Marketing: Organizing product or service launches, press conferences and promotional activities to help generate positive publicity and engage with target audiences.
  • Internal Communications: Developing communication strategies to ensure consistent messaging and alignment among employees, executives and other internal stakeholders.
  • Influencer Marketing: Identifying and collaborating with third-party spokespeople and thought leaders to help amplify a client’s message and reach target audiences.

Overall, PR firms play a crucial role in helping businesses and organizations manage their public image, navigate challenges and build strong relationships with their stakeholders.

George Medici, gmedici@pondel.com

Corporate America is Telling the Truth — Tips to Assure Reg FD Compliance

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With so many voices billowing false narratives and confusion these days, it is sometimes challenging to discern fact from fiction. But amidst all the dubious rhetoric, it’s good to know that sanity still prevails in the world of public companies.

Corporate America is standing out as a beacon of clarity and truth. And this isn’t by accident. It is the result of carefully crafted regulations designed to protect investors and ensure the integrity of the market.

As a refresher, the Securities Act of 1933, affectionately known as the “truth in securities” law, mandates that buyers of securities receive complete, accurate and truthful information before they invest. 

The Securities Exchange Act of 1934, referred to as the “34 Act,” created the Securities and Exchange Commission (SEC) as a body to regulate trading of securities after they have been distributed.

And in the year 2000, the ‘33 and ‘34 Acts were further strengthened by Regulation Fair Disclosure (Reg FD), with the intent of preventing public companies from selectively disclosing important information to certain shareholders and market professionals. Rather, it created a level playing field for all investors by ensuring that material information is disclosed to everyone simultaneously.

As the 25-year mark approaches since Reg FD was enacted, and as the IPO market warms up for the new year, following are a few reminders to help issuers assure compliance:

  • Maintain a formal disclosure policy. Outline procedures for publicly disclosing information, such as through press releases and social media. Press releases are by far the preferred disclosure medium, followed by social media and the company’s website. However, if a company principally uses the latter two vehicles to disclose information vs. press releases, it must ensure that both are widely recognized as the issuer’s primary distribution channels.
  • Train employees. For companies in the process of going public, provide formal Reg FD training – in person or by Zoom – for senior staff and for those who may be privy to sensitive information, and periodically conduct refresher training sessions. Specify who is authorized to communicate with investors and analysts.
  • Anticipate disclosures. Plan ahead if possible, and when doing so, be certain to remind the inner executive circle of the mandate for confidentiality.
  • Review executive presentations. Have an IR advisor or in-house counsel review presentations to be certain they do not contain material non-public information. 
  • Establish black-out periods for trading. Black-out periods can help prevent inadvertent insider trading and Reg FD violations. Some companies limit executives to only trading on a 10b5-1 plan to avoid violations.

Through Reg FD and other SEC mandates, corporations and their leaders are held to stringently high rhetorical standards – and they are doing a good job of adhering to them. Continued compliance requires awareness, regular refreshment, and constant diligent attention.

Roger Pondel, rpondel@pondel.com

Editorial Note: PondelWilkinson has been approved by the California Bar Association to provide Reg FD training to SEC lawyers for MCLE credit, and regularly provides such training to executives of pre-public and publicly traded companies.

What Do Investor Relations Firms Do?

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As part of our ongoing “back-to-basics” series on public relations and investor relations (IR), this blog outlines what an IR firm does and how choosing the right one can make a difference.

Investor relations firms primarily assist publicly traded companies in effectively communicating their financial performance and strategic goals to the investment community. Acting as both strategic advisors and tactical operators, IR firms ensure that messaging is clear, compelling and delivered to the appropriate audiences.

Here’s a breakdown of some of an IR firm’s key responsibilities:

Financial reporting and analysis: Preparing quarterly and annual financial materials, such as earnings press releases, conference call scripts, Q&A prep documents and investor presentations. An IR firm’s ability to analyze and interpret financial results ensures that investors fully understand a company’s performance within the broader industry and macroeconomic environment.

Investor and sell-side analyst targeting: Identifying investors and stock analysts whose mandates align with the company’s financial and industry profile. An IR firm organizes non-deal roadshows to connect issuers with potential investors, while recommending relevant conferences for company participation, and helping to foster long-term investor relationships.

Perception audits and key messaging: Conducting qualitative surveys of current and potential investors and other relevant stakeholders. The findings from these studies are crucial for refining key messages that align with investor expectations.

IPOs and follow-on offerings: Guiding companies through the entire initial public offering (IPO) process in conjunction with a company’s investment banking, legal and accounting teams. Activities include strategic counsel, crafting messaging, development of the presentation deck and press materials, and regulatory compliance training, such as with Regulation FD. An IR firm also will assist with secondary and follow-on offerings in much the same way as with an IPO.

Corporate governance: Ensuring that companies follow regulatory requirements and best practices, including environmental, social and governance (ESG) standards, Securities and Exchange Commission (SEC) mandates, and rules and regulations governing IR websites. Maintaining transparency is essential for fostering trust and credibility with investors.

Crisis management: Managing communications with key stakeholders, including investors and media, to mitigate reputational damage and minimize the impact on the company’s stock price during a tumultuous event. Effective crisis management is crucial for maintaining stakeholder confidence and ensuring a swift recovery.

Investor/capital market days: Assisting companies in planning and executing investor or capital market days to directly engage in a meaningful way with investors and analysts. These events showcase the company’s strategic vision, progress, financial performance and growth prospects, strengthening relationships and investor loyalty.

Market intelligence: Provide companies with valuable insights into current investor activity and sentiment, market trends and peer activities, to help management refine key messaging and optimize investor relations strategies.

IR firms are essential partners to public companies. They offer both strategic guidance and tactical support. They play a crucial role in enhancing a company’s reputation and credibility, helping build trust with investors, which can lead to long-term success and enhanced shareholder value.

George Medici, gmedici@pondel.com

Respecting the American Dream

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As someone who came to this country with my family in the early 1980s, I’ve personally witnessed and experienced the opportunities that America offers. For most immigrant families, the United States was, and still is, considered the land of freedom and opportunity. A representation of hope and dreams to pursue better lives.

Four decades and numerous jobs later—from scooping ice cream after high school to waitressing through college—my professional aspirations embodied the dream that anyone, no matter their birthplace or background, can achieve success, and that upward mobility is within reach for all.

Today, I am a partner at one of the nation’s most highly regarded investor relations and strategic public relations firms, representing quality companies, large and small, in multi sectors throughout the globe.

Corporations, at their core, are made up of individuals. Regardless of position or job role, the vast majority of those individuals are people with values, ethics and the potential for positive impact, working together to achieve the common goal of growth, which ultimately benefits the entire organization.

However, achieving this growth isn’t just about the bottom line—it’s also about how we get there. It is crucial to remember that the principles of values and ethics, and the belief that we all have the potential to make a positive impact, can guide all of us toward a more constructive and unified future.

I take great professional and personal pride in working, alongside my colleagues, for a firm that advises executives in matters pertaining to communications with factual integrity. Honesty is not just a policy, but the foundation of trust. Investors, journalists and employees at all levels, and certainly including our society at large, depend on clear, accurate and transparent information to make informed decisions. Misleading and divisive rhetoric only undermines trust and stalls progress. When we prioritize forthright openness, however, we build credibility and foster a culture of respect and understanding.

By advocating for transparency and accountability within corporate practices, we challenge the notion of some, who believe that corporations are inherently symbols of self-serving greed, and instead, we seek to promote a different view, one where corporations can be agents for positive change and camaraderie.

With Labor Day celebrations now behind us, we recognize the many contributions workers have made to America’s strength, prosperity and well-being. We also embrace corporate achievement and the symbiotic relationship between production-line workers and those in the executive suite.

Together, we can foster more pathways and create new opportunities for people, regardless of origin, to achieve their own American dreams.

Judy Lin, jlin@pondel.com

What is Public Relations?

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As part of our “back-to-basics” blog series on the foundational tenants of our business, we are dedicating this post to public relations. 

Many people have heard of public relations, but not everyone truly understands what it involves. A common perception is that public relations is simply about interacting with the public. While there’s some truth to this, the reality is much more nuanced.

A useful analogy can help with clarification: In advertising, the emphasis is on self-promotion, where the subject speaks for itself. In contrast, public relations involves third parties objectively communicating on behalf of the subject.

Public relations, or PR for short, is a form of mass communications used to engage with different types of audiences, including consumers, customers, employees, investors and lawmakers, among many other stakeholders. Specialized disciplines such as investor relations, crisis communications, government and employee relations all make use of public relations tools and tactics.

PR may be utilized to inform, persuade, highlight a particular point-of-view or prompt a call to action. It could be about a specific product, company, service or issue. Typically, an organization will engage a public relations firm to create and implement a program aimed at influencing one or several key stakeholder groups. For publicly traded companies, for example, a robust PR strategy can help increase awareness and visibility among investors, who look to third-party messaging to help inform their investing decisions.

At its core, public relations involves creating awareness between a brand or organization and its key audiences through carefully crafted messaging. These messages, often referred to as “talking points,” answer the essential question: What are the main points we want to communicate to these audiences?

The next step is determining how and where these messages are delivered. Talking points are transformed into various types of content, which are then distributed across a wide range of mass and specialized media, including news outlets, industry publications, digital and social media, broadcast channels, and more.

A fundamental objective in PR is how best to reach target groups where they work and live. Until the Internet, TV and newspapers were very influential, and still are to some degree. However, reaching targeted audiences in today’s Web-based world has become increasingly complex.

That’s why PR often is considered more of an art than a science. Crafting content that resonates with people and makes a real impact requires a great deal of critical thought and creativity within legal and regulatory confines, of course. Press releases, videos, newsletters, social media posts, podcasts and op-eds are just a few of the many essential tools used to inform and engage key stakeholders.

Whether it’s encouraging consumers to buy a product or investors to buy or hold a stock, or positioning a CEO as an industry expert, the ultimate goal of public relations remains the same: to help effect change and action, and to communicate with people in meaningful and transparent ways. That’s what public relations is all about.

George Medici, gmedici@pondel.com

What is Investor Relations? 

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As part of our “back-to-basics” blog series on the basic tenants of our business, we’re going to dedicate this post to investor relations.  

It is important to note that the number of investor relations firms, even in major financial markets, such as New York, Los Angeles, Chicago and San Francisco, is relatively small. That’s probably why when we’re at events or gatherings outside of our industry, we’re often asked, “What exactly is investor relations?” 

Let’s keep it simple: Investor relations, or IR for short, is a communications specialty that focuses on helping publicly traded companies get their stories out to Wall Street, including shareholders, potential investors and the broader financial community. Another term sometimes used to describe investor relations is financial public relations.

Public companies come in all sizes, usually determined by market capitalization, which is a company’s total stock value in the public marketplace on any given day. Stocks can be traded in the U.S. ­on Nasdaq, the New York Stock Exchange (NYSE), the OTC Markets, or on foreign exchanges such as the Toronto Stock Exchange (TSX), London Stock Exchange (LSE) and Frankfurt Stock Exchange (FRA), among many others. 

While public companies are highly diverse in what they do, all of them are regulated by governing agencies, depending on where their stock is traded. In the U.S., for example, the main governing body is the Securities and Exchange Commission (SEC), which requires, among other things, that all public companies follow a set of rules and regulations that ensure free and fair disclosure to everyone.

Compliance with these SEC rules is complex for those who are not in the know. Most public companies rely on investor relations professionals, whether in-house or externally, in addition to SEC attorneys, to assure compliance and language that is understandable. The main job of the IR professional is to help the public company communicate clearly and transparently, and in keeping with the law.

Investor relations encompasses many facets, such as disseminating financial information via traditional and social media; responding to investor inquiries; identifying prospective investors and research opportunities; organizing informational and required annual meetings; preparing investor presentations; and more.

Bottom line, the investor relations function is to manage the communications between a public company and investors, while at the same time being cognizant of other audiences – including employees, customers and suppliers – that may be recipients of the information.

The ultimate goal of IR is to deliver a cohesive and compelling message that resonates with investors, ultimately to help build shareholder value that is consistent with a company’s performance, progress, prospects and peers.

George Medici, gmedici@pondel.com

A Question for ChatGPT: Is AI Transforming Financial Communications and Threatening Jobs?

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The post below was written completely by AI (without any edits from yours truly). I prompted ChatGPT to write a blog about how AI can be used by investor relations professionals for competitive analysis, investor targeting, website content creation and more. I also asked it to discuss whether AI is taking away jobs, which is a question I hear often from industry colleagues.

So, without further ado, here’s what AI had to say. It’s actually pretty good, much to my surprise.

In the ever-evolving landscape of finance, technology continues to redefine traditional practices. One such area undergoing a significant transformation is investor relations (IR), where artificial intelligence (AI) is playing an increasingly vital role. From competitive analysis to targeting investors and crafting compelling content for IR websites, AI is revolutionizing how companies engage with stakeholders. However, amidst this advancement, the question arises: Will AI make investor relations professionals obsolete?

Competitive Analysis:

In the fiercely competitive world of finance, staying ahead of the curve is paramount. AI-powered tools offer unparalleled capabilities in analyzing vast amounts of data, enabling companies to gain deep insights into market trends, competitor performance, and investor sentiment. Natural language processing (NLP) algorithms can sift through news articles, social media chatter, and financial reports to provide real-time updates on industry developments, allowing IR professionals to make data-driven decisions swiftly.

Targeting Investors:

Identifying and attracting the right investors is a crucial aspect of investor relations. AI facilitates precision targeting by leveraging predictive analytics to identify potential investors who align with a company’s values, goals, and risk profile. By analyzing past investment patterns and market behavior, AI algorithms can predict investor preferences and tailor communication strategies accordingly. This targeted approach not only increases investor engagement but also enhances the efficiency of capital allocation.

Content Creation:

Crafting compelling content for investor relations websites and communication materials requires a deep understanding of financial data and regulatory requirements. AI-powered writing assistants equipped with natural language generation (NLG) capabilities can generate insightful reports, press releases, and shareholder communications autonomously. These AI-driven platforms can analyze complex financial data, interpret regulatory guidelines, and produce coherent narratives in a fraction of the time it would take a human writer.

The Future of Investor Relations Professionals:

While AI undoubtedly streamlines many aspects of investor relations, it’s unlikely to render human professionals obsolete. Instead, AI serves as a powerful tool to augment their capabilities, allowing them to focus on high-level strategic initiatives. Investor relations professionals bring invaluable expertise in building relationships, interpreting nuanced market dynamics, and providing personalized guidance to investors.

Moreover, the human touch remains indispensable in navigating complex ethical and regulatory challenges, especially in an era where transparency and accountability are paramount. While AI can crunch numbers and generate reports, it’s the human judgment and empathy that foster trust and credibility in investor communications.

In conclusion, the integration of AI in investor relations represents a significant paradigm shift in financial communication. By harnessing the power of AI, companies can gain a competitive edge in understanding market trends, targeting investors effectively, and crafting compelling narratives. However, rather than displacing investor relations professionals, AI complements their skills, enabling them to adapt and thrive in an increasingly digitized landscape. The future of investor relations lies in the synergy between human expertise and technological innovation, where AI empowers professionals to unlock new levels of efficiency and effectiveness.

Back to me, Laurie, a real person. The AI writing was solid, the messages were cogent, and we concur with the conclusions. Humans still bring invaluable expertise in interpreting data generated by AI, providing counsel to management teams and boards, and building meaningful, long-lasting relationships. So no worries.

Laurie Berman, lberman@pondel.com

Small Company Stocks will Outperform the Market in 2024, Survey Finds

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LOS ANGELES, April 17, 2024 — Seventy-five percent of investors say small public company stocks will outperform most major stock indexes in 2024, according to results of the 2024 Small Public Company Investor Sentiment Survey, conducted on behalf of SNN Incorporated, a multimedia financial news and publishing company, and PondelWilkinson, Inc., an investor relations and strategic public relations firm.

Of the investors surveyed, 74% say they are investing in companies valued between $50 and $300 million market capitalization, while 26% are buying stocks across all sizes.

“Three-quarters of those surveyed expect small public company stocks to outperform most major stock indexes in 2024, with about half expecting this stock category to outperform bigger companies this year,” said Robert Kraft, CEO of SNN Network, parent company of the Planet MicroCap Showcase being held in Las Vegas April 30 – May 2.

“While a dichotomy currently exists between those who are bullish on small public companies and those who are less so, as indicated by higher gains achieved thus far into 2024 in larger-cap indexes, investors surveyed view small company stocks as sought-after investments in 2024 and said they are sticking with their investment strategies,” Kraft added.

Other key survey findings include:

  • Gains: More than half of investors (52%) expect to increase their small company portfolio in 2024, after one quarter of responders (27%) reported gains of 20% or more from this segment in 2023.
  • Sector outlook: Technology (27%), natural resources and energy (19%), and healthcare and biotech (10%) represent the sectors investors are most bullish about for 2024. These industry favorites remain unchanged from prior surveys.
  • Risk tolerance: Ninety-one percent of investors have a “moderate- to high-risk” tolerance when investing in small public companies, 51% and 40%, respectively.
  • Buy or sell: Eighty-nine percent of investors say their general time horizon for holding small public company stocks is typically long- (more than 6 months) to very long-term (buy-and-hold), 50% and 39%, respectively.
  • Investment benchmarks: Seventy-six percent of survey respondents say they also are buying small public company stocks listed outside the U.S. Additionally, survey respondents cited management teams (38%) as the most important criteria for investing, followed by profitability (37%) and stock price (17%).

“As more investors become interested in small company stocks, it is critical that management teams communicate transparently, effectively and consistently,” said Roger Pondel, CEO of PondelWilkinson. “Where companies communicate their value propositions beyond traditional channels also is important, especially since the survey revealed a wide range of media that investors use to identify investing ideas, including social media platforms and increasingly, select participation at investor conferences and quality sponsored research.”

About the 2024 Small Public Company Investor Survey
The online survey was conducted in December 2023 to gauge investor sentiment as it pertains to small public companies valued at $300 million market capitalization and under. Seventy-seven percent of survey respondents categorize themselves as individual investors, followed by institutional investors (11%), family offices (8%) and wealth managers (4%). Four in 10 respondents (42%) have 20+ years of investing experience, followed by 10+ years (28%), 6-10 years (17%) and 1-5 years (13%).

About SNN Incorporated
SNN Incorporated is a global multimedia and publishing financial news investor portal covering the small-, micro- and nano-cap markets by providing news, insights, education tools and expert commentary. Visit https://www.youtube.com/@PlanetMicroCap to subscribe to Planet MicroCap’s YouTube Channel to receive notifications of new CEO interviews, as well as the latest episodes of the Planet MicroCap podcast.

About the Planet MicroCap Showcase
Hosted by SNN Inc., the Planet MicroCap Showcase is an annual 3-day event for the microcap investing community, comprised of company presentations, 1×1 meetings and educational panels. Click here for more information or follow Twitter X and YouTube for important updates.

About PondelWilkinson
Founded in 1968, PondelWilkinson Inc. is a national investor relations and strategic public relations consultancy. The firm represents a wide range of publicly traded, pre-public and privately owned companies, from startups to large caps, and develops programs targeting both Wall Street and Main Street. For more information, visit www.pondel.com. Follow PondelWilkinson on X at @PondelWilkinson or LinkedIn.

Celebrating Achievement with Grace

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CNBC.com, on February 17, published a growth story about the best performing stock in the past 30 years. It wasn’t Apple, Tesla, Google or any of those mega tech companies that might at first come to mind.

The best performing stock for the past three decades, according to CNBC and others, happens to be one of our longtime client companies that we proudly have represented for all those years.

Those who know us recognize that we, as with this client, are humble, hard-working, and not into self-promotion or bragging. After all, we haven’t even written the company’s name in this blog yet.

Nevertheless, in a world where accomplishments are celebrated and recognition is sought after, the concept of bragging rights sometimes is warranted. In this case, it’s more about our client and acknowledging achievement … a nod to success without crossing the line into boastful hyperbole.

Over the years, we adapted to our client’s ascent, strategically advising the company as it grew from a microcap issuer with a U.S. retail investor base, to a global, large-cap giant, attracting prestigious institutions and many sell-side analysts. Tactically today, we are still issuing their press releases, hosting investor days, serving as point-of-contact for the investment community and news media, and advising on messaging for M&A and a host of sensitive, sometimes complex corporate matters.

Admittedly, we are bragging that our organization has been part of some of our client’s success on Wall Street. But we are boasting with the intention of embracing this opportunity to uplift and inspire. The well-deserved success our client has achieved reflects talented leadership and unwavering dedication to innovation and quality, while always keeping egos in check and having a sense of gratitude.

We are proud to embrace bragging rights like a badge of honor—not as a tool for self-aggrandizement, but as a symbol of hard-earned success, as we congratulate Monster Beverage Corp., along with our colleagues behind the scenes at PondelWilkinson. 

Roger Pondel, rpondel@pondel.com

Judy Lin, jlin@pondel.com

Samantha Campos-Esquivel Receives the 2024 Cecilia Wilkinson Memorial Scholarship

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First-year USC graduate student and full-time media strategist, Samantha Campos-Esquivel, is the latest recipient of the Cecilia Wilkinson Memorial Scholarship.

We recently had the distinct pleasure of meeting with Samantha Campos-Esquivel, a graduate student at USC who has been selected as the recipient of the 2024 Cecilia Wilkinson Memorial Scholarship.

Bestowed annually over the last 15 years, the scholarship celebrates exceptional first-year graduate students at USC Annenberg School for Communication and Journalism who exhibit a profound passion for public relations or investor relations.

Samantha is a true embodiment of dedication and determination, pursuing her master’s degree in public relations and advertising, while simultaneously excelling as a full-time strategist at Horizon Media, a full-service media agency.

“I look forward to creating meaningful change in this line of work and showcasing my love for storytelling and this industry,” said Campos-Esquivel. “Studying at USC Annenberg has been a dream, and in these past few months, I have felt the impact and magic that a program like this has to offer. It is an honor to receive the Cecilia Wilkinson Memorial Scholarship and to have the support of tenured firms like PondelWilkinson in fulfilling this dream.”

Born and raised within the vibrant cultural tapestry of Los Angeles, Samantha developed a profound appreciation for the art of storytelling, particularly within the realms of music, cinema and television. Driven by her love for storytelling, Samantha found her calling in brand strategy and public relations. Beyond her professional and academic pursuits, Samantha is an enthusiastic explorer of diverse narratives, constantly seeking out new literary works, TV series and music that inspire and captivate her.

We extend our heartfelt congratulations to Samantha for this well-deserved recognition and for her dedication and commitment as she navigates the demands of both academia and the professional world.

Natalie Mu, nmu@pondel.com