Investor updates: the short email that builds your next round.
A regular update keeps your investors informed and on your side. Sent to prospects too, it shows them a track record before you ask for money.
The short answer
Send a short update on a steady schedule, monthly or quarterly. Lead with the numbers that matter, say plainly what went well and what did not, and end with specific asks. Send it to current investors and to prospects you plan to pitch next.
How it works
Headline
One or two lines on the most important change since the last update.
Key numbers
The same few metrics every time, plus cash in the bank and months of runway.
Wins
Customers, hires, launches and milestones, each in a sentence.
Challenges
What is not working and what you are doing about it.
Asks
Specific introductions, hires or advice that an investor could help with.
Why updates matter for the next round
Investors who see steady progress over months already trust your numbers when you raise again. Existing investors are more likely to take their pro-rata and to introduce you. Prospects who have read several updates arrive at the first meeting already informed.
Sharing bad news
Put bad news in the update, not after it. Say what happened, what it costs and what you are changing. Investors handle problems they hear about early far better than surprises near a raise or when cash runs low.
Before you hit send
- Are the metrics defined the same way as last time?
- Is runway stated plainly?
- Is every ask specific enough that someone can act on it?
- Have you left out anything confidential to a customer or partner?
Terms to know
Runway
How many months your cash lasts at the current burn.
Burn
The net cash you spend in a month.
Information rights
An investor's contractual right to receive regular financial information.
Do your updates and your deck tell the same story?
When you raise again, investors compare the deck with the updates they read. Upload your deck and we point out gaps in the story.
Questions founders ask
Monthly or quarterly?
Monthly works well early, when things change fast. Quarterly is fine later. Consistency matters more than frequency.
Should I send updates to investors who passed?
Yes, if they asked to stay in touch. A pass at one stage is often a yes later, after they have watched you execute.
Sources
Sources: common US startup investor-relations practice. Not legal or financial advice.
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