What is Investor Relations

You just spent 2–3 months fundraising, which took you away from growing your startup. Now that you have an investor, time to collect the funds and tell them “See ya until we have an exit. Thanks for the money!” ✌️ You want to be left alone and work on the things you told the investor you were going to work on. Why is this going through your head? Because you don’t want to partake in an activity called “Investor Relations”, which takes time and energy away from growing your company. It’s actually really easy and it’s beneficial for you. The best part is, you have already been doing Investor Relations before you even had investors, you just didn’t know it.

What is Investor Relations?

Investor Relations (IR) is exactly what is sounds like, managing the relationship with the investors in your startup/company. It facilitates an effective dialogue between your company and your investors. The founders or IR professional is tasked with providing up-to-date information on company affairs to their investors.

Investor Relations includes:

1. Announcements — Good news, bad news, help needed, and all of the above
2. Financial Updates — Consistently on a scheduled cycle, the frequency depends on company maturity and funding level
3. Capitalization Table (Cap Table) Management — Update frequently as this data affects each investor’s voting rights and payout
4. Corporate Governance — Code of conduct, Employee Stock Ownership Plans (ESOP), Non-Disclosures, etc

“If you don’t have trust then you can’t generate long-term value. The relationship [between investor and company] will be temporary.” — Bill Aulet, managing director for the Martin Trust Center for MIT Entrepreneurship

How do you build trust? Through open and transparent conversations that come from Investor Relations.

Is it worth the little amount of effort?

Yes! Data shows that through effective IR, you increase your chance of success and potential for follow-on funding, while reducing your cost of capital. Zelkova Ventures discovered that investors who are up-to-date are 200% more likely to re-invest.

Waccal for Investor Relations

Waccal makes managing IR easy for you by providing a suite of tools that remove non-value add tasks so you can focus on what really matters. Join others on the platform who are already seeing results. It’s free to get started. 😊 💃

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