- How to send investor updates like a pro.
This is for the pro startup founders out there,
if you've raised some money,
you've gotten people to part with their cash,
I'm going to teach you guys how to actually
keep them informed.
In the big world of corporations,
they call it investor relations.
In the startup world, it's just like
updates, email updates,
just sending them something!
I know, I get it. You're busy.
You have no time, and you're just like,
"I gotta write this email."
And I get it, you don't want to look stupid.
Like you're like, "Well things aren't as good as they
"should be," and you don't want to share that,
or you don't want to waste the investor's time
by sending them the wrong information.
So today I'm going to share with you guys
three kind of aspects of sending investor updates,
and I'm going to share with you two powerful
tips at the end, you don't want to miss this.
The truth is is here's the deal:
I've invested in 34 plus companies at this point
in my career as an angel investor
put my own money to work in other people,
and I'm going to be honest with you,
there is maybe a half dozen companies
that actually send me regular investor updates.
Actually, I'm going to give you guys a shoutout
to my buddy Scott at classy.org.
I'm not even an investor.
I am a formal advisor and I sit on their advisory board,
and this guy runs a company like a pro.
So a lot of what I'm going to share with you guys
is both things I've done for my own companies,
I've built a couple venture-back startups
and I've kept my investor in the loop,
and then also what I've been inspired by seeing
some really great email updates.
So the number one is frequency,
How often should you send the emails?
Well the truth is I believe in the early days,
when you're just starting going,
maybe it's your seed round, six weeks
is probably a good tempo.
Any more often than that, maybe there's
not a lot of new information.
So in the early days, the first 16 months,
two years, every six weeks would be awesome.
Again, the alternative is not which is
what most people do and it frigging
frustrates the bejesus out of me.
And if you're watching this and
I've invested in your company,
no, this is not my way to guilt you into doing it,
I'm just sharing with the world
some of the things that I've learned.
So six weeks.
As you progress, and you probably have
a board at this point, two years plus,
every month is kind of the frequency that you want to do it.
So that's the two ranges that I would suggest
are kind of optimal.
The second is method.
How should you send these emails?
And here's my tip: send them individually.
Do not send a broadcast to all your investors,
all your advisors, and all your, anybody else.
Because to me, then it's not landing as a personal email
to the person.
It's not saying, "Hey," you know, "Frank.
"I really appreciate you investing.
"Here's the update and et cetera."
And they'll read that.
And I'll be honest with you, Mark Cuban
invested in my company, and he is
one of the few investors, I had some amazing investors,
the top guys that if you go look and you say,
"Oh those guys are great investor,"
those guys always responded as well;
but Mark Cuban, as busy as he is,
always responded with really insightful questions
or comments or feedback;
he read everyone of my updates.
So I always took it as a personal,
almost out of appreciation for their time,
I always sent them an individual email with my update.
The third is the format.
It's, what do you say in these updates?
Number one is get to the numbers.
Don't write these long-winded stories
and reasons and anecdotes and whatever.
At the end of the day, just share the numbers.
Bullet points are amazing.
If you want to do that, that would be awesome.
So really just get to the numbers,
and always start with what's bad.
It might sound crazy but at the end of the day,
wouldn't you want them to leave with a good impression,
so you put that at the end, the good.
So start with the bad, end with the good,
and then to me it's all about being concise.
So what I do in my updates is I say at the beginning,
"Here's what I'm going to cover."
I just, bullet points, these are the kind of the headings,
and then within the email, I'll put the different sections
so they can skim it, they can jump write to a certain point,
it makes it easier for them, it's very concise.
So that's the format.
Third, I'm going to suggest to you guys
put a call to action.
Your investors are there to support you.
Yes, they gave you money, but trust me,
because I'm the same way, they want to help.
They want to know what are some of your big challenges
and how can I specifically help?
Now don't be lazy.
Don't be like, "I need an introduction to 15
"technical leaders out there."
No, no, no. Don't be lazy.
Or, "Can you give me an introduction
"to somebody that works in retail."
No. Go do the research, try to understand
the person's background, the investor's background,
and ask for something specific.
"Hey, Frank, I noticed that you're friends with
"John at this company, because of LinkedIn.
"Do you mind making an introduction?"
Or, "You know, your background in marketplaces
"is really valuable, do you mind jumping on a 30-minute call
"so I can walk you through kind of our four-month
"strategy, product development roadmap, et cetera?"
So be specific but always put them to work.
Your investors are there to support you
and serve you and help you,
and many entrepreneurs just don't take advantage of that,
and it blows my mind because, trust me,
when you put your money into something,
you want it to generate a return,
you want it to be a huge outcome. So put them to work.
So that's action.
Now here are my two power tips.
Number one, and unfortunately this happens way too often,
is don't go silent.
I get it, you're working on your business,
it's not going good, you're supposed to raise
a round of funding, it didn't happen,
and the default state is, "I'm going to fix this
"and then I'll send the update.
"I'm going to have this win and then I'll send the update."
Do not go silent.
To me, if you've got
two to three months of runway in the bank
and you haven't sent an investor update in a while,
shame on you, that's not cool,
because investors want to help.
They want to make sure that they
can be there to support you,
and if you keep delaying it and putting it off,
you're not really serving yourself or
really respecting your investors.
So that's a big one.
Then the other one, if you want to be
a baller, if you've got the gumption,
if you've got the "you know what"
to really do this at the next level,
here's what my challenge is to you:
Send your updates to everybody in the business.
team@company.com, whatever it is,
or all@, whatever your group team email list is,
send it to the investors and then
also send it to your team.
I've always done that because to me it's like
they know what's going on anyways in your business,
and if they see the way you're communicating
to your investors and they see the priorities
that your setting, your goals,
and they know that you've made that commitment,
they're going to support you and give their all,
and to me it just creates an amazing
sense of collaboration and community and trasparency
amongst your team.
So that is not for the faint of heart.
If you've got it in you,
send it to your whole team.
That's what I've got for you today.
I want to invite you to share this video.
If you know anybody else that has been struggling with this
or you know that they're about to close a round
and they should probably learn how to do
an investor update, share this video with them.
I want to invite you guys to subscribe.
I want to ask you guys to leave a comment below.
Let me know what the number one
takeaway from this video.
What aspect of sending an investor update
did you not think about until you heard it in this video.
I want to hear from you below in the comments,
number one breakthrough, takeaway, et cetera.
I want to ask you guys, or really challenge you,
to live a bigger life and a bigger business,
and I'll see you next Monday.