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One of the most underrated skills that a startup CEO needs to know is how to keep his/her investors updated, excited and engaged. It is through the lens of the CEO that investors know what’s going on, and in some ways, engage with the businesses. Furthermore, if you need more money down the road, you want your investors to be happy with how you’ve managed the business and your relationship. Here are a few tips on how to best interact and update your angel investors:
1). Keep in touch, preferably by email.
If you are an early stage startup, you should be in touch every 1-2 months at least and every 2-3 months if you are a later stage startup. If you have a full board of directors or advisers, it is probably best to setup a regular phone conference.
2). Be concise.
Keep your correspondence between 1-3 pages. Your investors are busy and they are smart. They just want to know the key information about what’s going on; they don’t need every detail.
3). Be consistent.
Create some sort of template that you use in every correspondence. For example, you can use the following headers: highlights, low-lights, and goals. With a consist report card of sorts, your investors will feel up to date and any uncertainty will be put to rest.
4). Be truthful.
Highlight your successes, but don’t hide all your problems. Be sure to include one or two of your main strategic problems. First, they may be able to help. Second, every company has problems; it will seem fishy if you don’t disclose yours. With that said, you don’t need to give away any secrets or provide sensitive information. Rule of thumb: if you wouldn’t want it going public or having your competitors read it, then don’t write it.
5). Involve many.
You know the power of networking. Keep your network up on your company. Even if they aren’t investors, they may be able to help out now or down the road. Keep those bridges strong by updating them on your company.
6). Ask for favors.
This monthly update is a great time to ask for favors. Whether it be an introduction, key personnel, marketing favors, etc use this as an opportunity to get some help.
7) Record your correspondence.
First, this makes it easy on you and your investors when you need to go back to an old update. Second, it avoids any problems down the road with claims about information that was or was not disclosed.