The Complete Guide to Composing Startup Investor Updates

I’ve now read over a thousand startup investor updates. The most effective updates — the ones that immediately grab my attention and heighten my interest — have similar characteristics. My advice is below, along with a comprehensive template for startup investor updates.

Common Characteristics of Stellar Startup Investor Updates

For a company that has accepted outside financing, building shareholder value is a key element of success and the best way in which a CEO can help investors. To that end, great investor updates:

1. drive investors to advocate for the company;
2. provide enough information to ensure speedy shareholder decisions that may be required at any time during the life of the company;
3. disclose enough information to maintain ethical integrity;
4. fulfill legal and contractual obligations to shareholders;
5. require less than one hour to prepare;
6. require less than thirty seconds of investors’ time to scan and comprehend the highlights.

What to Include in Startup Investor Updates

In preparing an update, I tell entrepreneurs to ask themselves these questions.

1. If you had only three minutes, what would you tell your investors in order to get them excited about your company?
2. What three things could your investors do to help your company?
3. If you had only one minute, what bad news would you disclose to maintain ethical integrity and meet your legal and contractual obligations?

Use your answers as the starting point for your update.

Optimizing Startup Investor Update Readability and Response Rates

Most investors want to be helpful, but they also receive many emails. I suggest the following.

Include your update in the body of the email. If you can, eliminate the friction of downloading documents or logging in.

Make it mobile-friendly. Be conscious of font size and mobile formatting.

Use bullets and headlines. Some of the busiest investors have the best connections. Make your highlights scannable while sitting at traffic lights.

Use consistent cadence and format. Reporting on the same KPIs in consecutive reports and using the same format makes it easy for investors to compare updates and track progress. Quarterly updates are ideal in most cases, but I recommend monthly updates for startups in the midst of a big event such as the first round of funding, a fundraising round that your investors are actively helping to close, an acquisition, or a distress situation.

An Investor Update Template for Startups

I recommend formatting updates like this.

1. Summary statement ‒ Your 30-second elevator update.
2. Asks ‒ Three or four specific ways in which your investors can help. As I mentioned, most investors want to be helpful, and see an entrepreneur’s ability to garner support as a positive indicator. I recommend:
   - making these asks as specific as possible by asking for introductions to specific people and organizations;
   - eliminating friction by offering to prepare a forwardable introduction request email to facilitate double-opt-in introductions;
   - enabling easy evangelism with click to tweets and sample text for social shares.
3. Quick hits ‒ Three or four bullets to outline the most significant highlights and any lowlights that should be disclosed.

I recommend no more than four sentences on each of the following. Bullets are ideal.

4. Key metric ‒ An update on the metric that matters most to your business. I like to see a graph that shows how performance on this metric compares to each of the last 12 months.
5. Sales ‒ A list of any key customers won or lost since the previous update. Include significant increases and reductions in customer contracts.
6. Fundraising ‒ A summary of fundraising plans, a list of notable new investors, and announcements of the closing or opening of fundraising rounds.
7. Product ‒ Significant new product and feature launches, milestones, and setbacks.
8. Team ‒ New hires, job openings, promotions.
9. Other key metrics ‒ When applicable, I also like to see revenue, net burn, runway, MRR, churn, and CAC. I like to see a graph for each metric that shows how this compares to each of the last 12 months. Positioning these graphs at the end encourages readers to actually read the entire update. 

Related resources:

The Startup Metrics Cheat Sheet: How to Calculate What You Are Expected to Know
How Should You Follow Up with an Investor?
How to Ask for an Investor Intro
The Metrics Every Entrepreneur Should Know by Heart