Investors play a vital role in your startup’s growth and success. In addition to providing funding, they provide insights and expertise that can help you build a great business. Keeping them engaged with your company is important, and one of the best ways to do that is through regular investor updates. The investor update is a monthly or quarterly document that details team updates, operational progress, core metrics, recent wins and losses, product roadmap prioritization, and a snapshot of your finances. Investors can receive this information in various formats, from presentation decks to simple email updates.
The most effective investor updates are those that are transparent and share accurate data with key stakeholders. It is critical to be honest and avoid only sharing the good news, as this can lead to trust issues and alienate investors.
A strong investor update should be structured into four sections: Overview, Performance, Economics, and Needs. Begin the overview by describing how your business is doing, including positive and negative trends. Describe the industry and competitive landscape, and share how you plan to address any challenges that have arisen. Then share your financials, including burn rate and cash runway, so that investors can see how much you need to raise in order to achieve your milestones. Lastly, include your “ask” for the next round of funding. This can be a straightforward request, or it can be more detailed, such as an idea for the next major product feature.