If you write regular investor updates, believe me…they could be WAY better.
Why should you care? Over the past 10 years I’ve seen over a thousand investor updates. Within that sea of emails, there have been hundreds of instances (no exaggeration) of a well-written investor update leading to a company changing event – the hiring of a pivotal role, the closing of a deal, the intro to an investor…
Investor updates are incredibly valuable on a variety of dimensions. They establish trust with your investors, provide material for advisors to share helpful feedback on, arm your supporters with info to evangelize, and open a reliable channel to request much needed help.
Beyond that, they are a simple but productive motivational tool. The need to gather data and report progress (or the lack thereof) represents a regular accountability check that drives teams to produce. This is especially effective given the over-achieving nature of many founders.
And how can they be better?
If you’re brand new to investor updates, you should start by searching on Google or Twitter for some basic advice. There are a ton of investor update templates and guides out there. They’ll outline the common parts of an update, talk about the importance of consistency, and maybe even share a real world example.
Since those common tips have been exhaustively covered, relisting them here would be a waste. Instead, I want to share some of my favorite, lesser-known techniques at making investor updates shine that I’ve encountered over the years.
Here are 6 gems to consider adding to your next investor update:
Repeat what you are at the top of every update in the simplest way possible. Don’t expect your investors to be great at succinctly describing your company. Let’s be honest, it took you a ton of time to get that down yourself. By repeating the one-line description of your company every time an update goes out, you maximize the chances an investor entices a future investor, business partner, or potential hire to spend more time with you.
Investors get hundreds of emails a day and have the attention span of mice. It’s in your best interest to create a headline to help the investor understand when and why to spend more time with the email, which a simple TL;DR can do very effectively.
Your investors have the network to deliver game-changing value to your company. The problem is most investors have an overwhelming number of responsibilities that can make it challenging to have them focus their attention on you. One way to do that is by stoking the competitive juices of your investors by recognizing the most helpful investors since the time of the last update. Your investors will want to be recognized to build their reputation and in turn secure allocation in your next round.
It’s commonplace to include an “asks” section in an investor update to leverage the network and expertise of everyone around the table. The issue is the conversion rate from “ask within an investor update” to actual favor executed is quite low. One tip Sam Corcos from Levels shared with me on how to improve your response rate is to send individual emails requesting help. The way I do this is forward the investor update email to each person you’re requesting help from and say “I included X asks in this update, but I wanted to make sure you saw because I think you would be super helpful here”
When I wrote investor updates, I used to reply to the last investor update and update the subject. That kept a running list of old updates that anyone could reference. If you use Notion or any other shared doc, make it easy to reference previous updates. This is good practice for a number of reasons.
First, investors and advisors will unpredictably spend time with updates. It’s very possible the last time you sent an update, one of your advisors was swamped and didn’t read it. This time however, she is on a long haul flight and can really devote time to your company. In those situations, you want it to be easy for her to read past issues and learn different ways to help.
Additionally, professional investors learn to find patterns in the data of companies. Giving your investors an easier way to observe the trends of your company can help them uncover opportunities to deliver warnings, to give tactical advice, and to help overall.
As a founder, you don’t have unlimited touch points with your advisors. Investor updates don’t have to be all numbers and facts. Include things about your team and photos when you can. The closer you draw in your advisors, the more support you’re likely to receive. In my investor updates, I would sprinkle in elements of humanity whenever I could.
Leverage these 6 esoteric tips to supercharge your investor updates. Feel free to send me one of yours too! I’m always excited to learn.