Falling in the trap of not communicating with your investors?
Why investor relations is key to follow up financing rounds and how often should you communicate with your investors?
After you have done all the hard work of courting investors, meeting them multiple times, talking to them over coffee breaks or lunch breaks, sending multiple emails, the cash now finally arrives on your bank account and there is a slight sigh of relief since you can finally get on with business…
The most common feedback received from investors are that they feel frustrated and left in the dark if entrepreneurs do not communicate on a regular basis.
Regardless if you speak to one or multiple investors, rule of thumb should be to reach out at least once a month. It might feel spam-like in the beginning, but imagine sitting in the other persons’ seat, they just invested their hard earned cash in your company and they are not hearing anything from you for months. The anxiety builds up pretty quickly and frustration starts to surface.
Remember — Every company is different and will discover their own style of communicating with investors that why it is important to find your framework early on.
Investor updates don’t need to be lengthy essays, they can be simple and we have a few tips on what works best.
We have a downloadable template that we recommend to all our companies on FundedByMe — Let’s take this example below 👇
Subject
We just launched our beta and need your help.
Summary — Present a profit & loss topline summary. Based on the current cash how many months do you have left?
We have grown 50% over the last month signing 13 new clients we see some good retention in the numbers.
Based on the current cash we have another 13 months of runway left.
Highlights — Mention the achievements that you are proud of.
- We have been invited to record a podcast that seems to be very popular amongst other entrepreneurs, hopefully, this will attribute to the signups — will share the link when we have it.
Lowlights — challenges and potential fallbacks
- Many users are complaining that the sign-up process sucks. Getting our UX to take a serious look at this and hopefully, we can improve this in the coming month.
- John has flagged that he wants to step down in time.
Asks — Is there something your investors can help with?
- Do you guys have any suggestions on ways we could improve the sign-up process?
- A big company has reached out and wants us to present to them, I am not sure if the timing is correct, how do I deal with this client?
Other information — Sales figures, New hires, links to mention in the press
- Say hi to Janet 👋 — experienced frontend developer previously with X
- Invoiced €20K last month
- Mention in Techcrunch — www.techcrunch.com etc.
Interested to receive a template version of this? https://arnosmit.typeform.com/to/W8Gq0F
You can also use some services that automate this functionality and more, some of these services are for more established companies so we recommend that you do your due diligence.
- Visible.vc
- CapDesk.com
- eAktiebok.com
- Other mediums also include Facebook, Linkedin or private forums.
Thanks for taking the time to read the article and remember, building a strong relationship takes time and commitment.
