Investor Updates: What you should do

Photo by Michal Czyz on Unsplash

Startups are in continuous movement and over time develop relationships with investors and potential investors for subsequent rounds. It is therefore important that they establish a communication channel where they can periodically share information about the business and future.

The easiest way to do this is through a virtual newsletter that contains in a concise but complete way the most relevant information of each period. This newsletter is similar to your investor presentation, in addition to relevant information it is important that it has a structure and form that is attractive and easy to read. After analyzing multiple market newsletters, the main elements to consider are the following:

  • TL;DR: This section describes the main milestones of the company and its objective is to convey to the investor in a clear and concise way the status of the organization. The recommendation is to use between 3 to 5 short sentences in order to attract the investor’s attention or to give him/her the most important information in case he/she cannot read the whole content of the email.

Geography: Present the main KPI’s according to the company’s geographic presence.

Growth: Shows the trend of business development by putting the traction of users and assets of the company.

Financial: Include the most relevant financial figures, such as sales, margins, cash flow, etc.

Operations: Present metrics of the company’s operational efficiency.

KPI’s (Main Location, Growth, Financial, Operations)

Some recommendations to make this section more attractive are to use graphs, traffic lights showing the progress of the KPI’s, percentage changes of the figures with respect to the previous month, analysis of projected results versus current results as well as cohort and retention analysis.

  • Product: Collects the most relevant information regarding product status, development progress and future requirements.

Introductions with investors to facilitate future capital raising.

Talent (people or recruiters) — at company level and board level

Business development

Others: Review presentations, write reviews, give product feedback

  • Press releases / Events attended: Space dedicated to show the company’s participation in the ecosystem through media releases or participation in events.

General recommendations:

  • Remember that you can adapt your newsletter for current startup investors and potential investors.

The investor update is a fundamental part of your investor relations toolkit, dedicate time to it and make the most of it.

Hector Shibata. Director of Investments & Portfolio at ACV a global Corporate Venture Capital (CVC) fund and Adjunct Professor for Entrepreneurial Finance.

Gonzalo Soriano. VC Investor at ACV.

ACV is an international Corporate Venture Capital (CVC) fund investing globally in Startups & VC funds.

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ACV

ACV is an international Corporate Venture Capital (CVC) fund investing globally in Startups & VC funds.