How effective investor relations drives investment

How should I communicate with my investors?

Reetta Pellikka
Nov 4 · 3 min read

This is a question that every company with an investor base needs to ask itself. This is especially true for companies that have gone through a crowdfunding round. What can often seem a fragmented investor base seems a challenge — but good communication with investors is the key to good investor relations. Earlier this year specialist investment group, Privanet, looked at their investment community and shared their findings with CrowdWorks.

The research sought to find out how much communication between investment rounds was optimal. It did this by looking at communications channels, quantities and receiving in-depth analysis from investors. For privately funded companies this research is invaluable, it gives them the platform to build their investor relations communications strategies based on hard facts from real investors.

How often should I communicate with my investors?

According to the research, investors that received more regular communication from their invested companies were much more engaged. In fact, compared to the investors who were not well communicated with, there was a major difference in willingness to help the invested company. The data suggested that regular and clear communications, above all, was what leads to higher engagement and willingness for investors to support the company.

Given this, it is surprising that almost 80% of the respondents would want more communication from their invested crowdfunded companies. Not only that but 70% of investors would want to receive communication at least once a month, clearly demonstrating that regular communication is crucial for the investors. Conversely, only 17% of investors were currently receiving the amount of communication they wanted.

With this clear and present opportunity for companies to improve upon their communications and therefore increase investor relations, it should also be noted that the research showed transparency in communications hold the greatest weight. Of those questioned, 94% stated that transparent communication is an important criterion for their investment decision. Therefore, keeping the channels of communication, open, transparent and frequent should lead to increased investor engagement, support and impact for your company.

Engaged investors are ready to help the company when needed

When a company did have engaged investors then the numbers prove the point, with 51% ready to help their company when needed and invest up to half an hour per week to help. This resource of engaged investors with diverse backgrounds is a powerful tool to help lead a company to success.

Of the respondents ready to help their invested company, 59% said they would be able to help the company more than 15 minutes per week and 75% said they would give their opinion on an issue the company presented. The ability to tap into the knowledge pool that investors have is a game-changer, especially for crowdfunded companies.

However, organising investor relations is a distinct challenge, especially when investor numbers increase. While the research showed that the most popular channel for investor communication was via email, it is not a channel to build engaged investor communities. Engaged investor communities offer strength to the company, which cannot be found anywhere else. To turn your investors into a community, you need two-way communication and discussions. Being able to have discussions with your investors in a secure space, where more passive investors can follow the conversation and gain the same insights as the active followers, is key to investor engagement.

Focus investor relations management in one platform

offers an investor relations platform for companies with several investors, where they can build engagement on top of their capitalisation table. By focusing communication to one channel and enabling investors to also give back, instead of just being passive receivers, building engagement will be easier. With CrowdWorks the companies can communicate in a two-way manner with their investor base, ask and get help, share insights and news, showcase their current KPIs and tell their story, all in one place.


Read more at and sign up for a demo.

CrowdWorks

Posts and testimonial from CrowdWorks

Reetta Pellikka

Written by

@CrowdWorks

CrowdWorks

Posts and testimonial from CrowdWorks

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