9. Investor Updates Lead to Investment
Note: this is Part 8 of Fractionalist’s Startup Fundraising Series for Early Stage Companies.
I've always made it a practice to keep investors and advisors up-to-date via a really simple email. I send this email out on a weekly or bi-monthly basis and I always follow the same format:
One statement: how are you feeling? Elated? Beleaguered? Laser cats? I like doing this as it sets a tone for the update I'm sending out and forces me to look back on the last week and sum it up succinctly.
Tactical issues: Just what it says, this is a place to talk through specific tactical issues you're having. Having trouble with a product manager? Not sure you have your HR policies in order? Trying to figure out the details of your EU rollout that you already decided to make happen? Get it in this section. This is also a great spot to share any KPIs that you’re tracking for your company.
Strategic issues: How are you going to think through your relationship with strategic partners? Apple released a new technology that could be competitive to your products, how will you adapt? These are broader issues that might be tricky to cover quickly in an update like this but even listing them out here can help you think through them and also give your advisors/investors a chance to chime in.
Board/investor issues: I compose this one every week but will only send it on to the actual board of directors. This is where we talk about runway, fundraising status, discussions of new board members, etc.
Asks/Need: Not every week but very frequently I will make an ask of people. I need intros to new investors. I need help interviewing a member of the executive team, etc. Make them easy to deal with and facilitate the help. If someone is willing to help you, you should make it as easy as possible.
To tee this update up for my audience, I keep a running list during the week of each of these elements. When I hit a roadblock or want some input on something, I toss it into my list so that at the end of the week when I'm compiling everything, I know exactly what I want in there. I also find reviewing my calendar for the week can help jog free any items I didn't jot down at the time.
You get a lot of no's when out raising money and that's okay. I ask those folks if they would be up for being a part of my regular email updates. I put advisors, colleagues, potential hires and just about anybody that might have a connection onto my distribution list. I’m probably oversharing but I’ve found it the most effective way to keep me honest when it comes to scaling my business. Most folks agree to be a part of it and if you're using the right tools, it's super easy to manage it.
So why are you doing this update? I've had people tell me it it seems like busy work. I do it for three specific reasons:
Staying top-of-mind: People are busy and investors have a gazillion deals they are juggling. This regular update helps keep your company top-of-mind for the week ahead. It's meant to be consumed while in line for coffee or in the evening after the kids have gone to bed. You never know a connection someone might make because they are in the current know about what you're up to or what you need.
Staying up-to-date: When I get the chance to catch up with companies after a few weeks or months, I always have to get the "download". What has changed, what's new, pivots, hires, etc. It occurred to me that these founders are having to do this for every single investor/advisor they engage with. It's just not efficient. Keeping people in the loop with regular email updates means when you do finally get some voice time with them, you can make the most of it.
You never know: Sending these updates have led to strategic hires, partnerships, new business and even investment. Those investors that passed on you because you're too early for them will be playing along and if you hit your milestones and they see the progress, you might finally be in their range. You just never know.
Doing updates like this takes real discipline. It's easy at the end of the week to just bag it and not send it along. I used to have a tool I'd use (that got acquired by Salesforce and killed) that would incessantly email me on Fridays until I actually sent out the update. They even had a really easy-to-use form for it. I finally had to build my own solution to force this for myself and it was really helpful. It's also a great way to reflect on the week and think a bit about the week ahead. It's so easy to get caught up in every single detail and fire going on that you miss the important things.
What’s next?
This is part of the Fractionalist Fundraising Series for Early Stage Founders. We always appreciate feedback on the series and we're always here to help you with your fundraising efforts.
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