Investor updates are regular communications from a startup to its investors that share recent wins, losses, financials, team changes, and customer wins. They are an important tool to maintain transparency and ensure that investors are aligned with the company’s strategic initiatives. Investor updates can be sent as email documents, slideshow presentations, Word documents, video updates, or meetings. Regardless of format, investor updates should be consistent, professional, and contain the following four sections:
Overview: A summary of the current state of the business. This could include an industry recap, a breakdown of the most important financials (burn rate, revenue growth, MRR, and churn), and a brief description of each major product initiative. It’s also a good time to highlight any new hires or other staffing changes that have occurred. Finally, this section should also be the opportunity to send a “bat signal” for any areas that need help – be sure to include an asks section in each update.
Creating an investor update can feel like a chore, especially if you are a busy founder trying to scale your company. However, it is in your investors’ best interest to see a strong, well-performing company. Consistent investor updates give them insight into the business that will help them identify opportunities to support you and advocate for your next round of funding. Investors who receive updates are twice as likely to invest again. So, start making this important communication a priority! Visible is the best way to streamline your investor updates and make them more effective.
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