Template for the Perfect Investor Update
First off, anything is better than nothing. If you think you have nothing to share, let your investors know, we can help! In fact some of the best investor updates I receive, highlight their challenges. Challenges finding the right hire, extended sales cycles, and high customer churn are not unique to you and something that can be overcome and if possible, something we can help you overcome. However, we can’t do that if we don’t know what is going on. Heck, even companies I passed on send me updates…Mostly to rub it in that I passed but still, it makes it that much worse when actual portfolio companies don’t send them.
There is also another benefit to creating a monthly update. It provides clarity on the current state of the business. One of the best investor updates I receive is from a company I invested in 6 years ago. Every single month over the past 6 years I have received a one page update that goes out to every investor and every current employee at the company. It states very clearly, in a consistent format, here is what is going well and here is what is not going well. Here is what we did and here is what we are going to do.
Some companies will format the update as a PDF or PPT but for my money, the best updates are simple and written in the body of the email. If I were to create the ideal update here is what it would look like:
Lots of great stuff happening this month. We are close to completing a major feature upgrade and will look to push out to the market later this month, we hired Sarah from Salesforce to build out our customer success team, and recently signed Google which we are very excited about.
Quick and dirty intro paragraph (no more than two sentences) to convey some upcoming product news, which you may want help promoting, a key hire you made, recent challenges, or impact customer signing.
- Front-end developer: We are still struggling to find the right person for the team. If you know anyone who might be a good fit please pass them along.
- PR push: We are looking to do a PR push for the new product feature later this month. If you have any publication contacts we would love an intro. Otherwise your support spreading the word will be much appreciated!
Be specific here. If the ask is too vague it won’t resonate. Also if the needs are not urgent I recommend putting this section at the bottom. Most important items go to the top.
- Signed Google to a 1 year contract worth $90K. Great work by Matt (Head of sales) who has been working the deal for 2 months.
- Also signed x, y, and z for an additional $120K in ARR.
- Hired Sarah to help fill out our customer success team. This role will be increasingly important in the next few months as we roll out additional features.
- Recent Press: TechCrunch link, Wired Link, etc.
These are the sharable nuggets. Speaking for myself here but I tend to brag about all of our investments as if they were my children. These updates give me an arsenal of highlights to talk about with potential customers, investors, and employees.
- Customer churn has spiked over the past two months. To date we have not spent enough on new customer education. Sarah will spend the majority of her time focusing on this area.
- Customers are requesting month to month contracts. Debating internally how to approach that.
There are challenges with every company. The ability to identify them and act on them is incredibly important and something your investors can help with. If you are debating a shift internally and want to get an outside opinion, the investor update is a good place to do it.
Copy and paste the performance of your 1-3 most important KPI’s. This could be sales, users, time to resolution, etc. If you are not tracking your KPI’s or have yet to identify your KPI’s this is a great time to start!
Please reach out to me if you have any questions or comments.
That’s it. That’s the template for an investor update that 99% of investors will be happy with. At the least we are going to brag about your company to our friends, at the most we can help you with some of your biggest challenges and needs. It’s hard to do either if we don’t know what is going on.
Gross margin documents the business your product is building, yet it’s often tucked away in a financial update while a medley of product metrics enjoy the spotlight.
The bottom line: Expansion-stage SaaS companies are well positioned to thrive in 2021.
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