An investor update is a document that provides investors with key metrics, financials, team updates, customer wins, and the current state of your startup. They can be shared via email, Word docs, slides, or PDFs. The goal is to share a clear picture of the company’s performance and progress that will build trust, maintain transparency, and help you raise capital more effectively.
Investors have a real, monetary stake in your business, so they deserve to know both the good and bad news. However, many founders make the mistake of only reaching out with positive updates, which can ring hollow and lead to distrust. Likewise, only communicating challenges can cause alarm and panic, and by the time you need them to help you out, they may have lost interest.
As such, it’s important to find a balance between highs and lows, and to be consistent with your approach. The best way to do this is to pick a schedule (e.g. at the end of every month, or at the start of the next) and stick to it, so your investors can expect a regular and timely update.
You can also lower the lift on this task by choosing a template that you can reuse, and filling it out each time with the highlights of the past month. Also, make sure to include an executive summary that is brief and clearly communicates key performance indicators like revenue growth, cash runway, and more. And of course, don’t forget to thank your investors for their support.