Context
The executive leadership team at big companies often have to do quarterly report outs to the board of directors and investment community. Often they have the luxury of full service departments (finance, communications, project management) to help them prepare for the same. Not just at big companies, such a model is valuable for the small companies and startup founders as well.
As an investor and advisor to several startups in the past five years, I found differing degrees of communication. I liked the founders who showed up periodically with a honest updates. I often found myself drawn to supporting them more. I heard similar inputs for my peer group of investors and stakeholders. Instead of showing up once in a blue moon to the investors, keeping a steady dialog ensures that the entrepreneur builds championships. Also the entire exercise to build a periodic update encourages one to retrospect and plan better.
Here is a quick template to guide the entrepreneurs to post periodic updates.
Preparation
Why: Informed and engaged investors mean positive traction for potential future investments.
Periodicity: At a minimum keep a quarterly updates flowing. Monthly update is more preferred. The update is a natural point of reflection for an entrepreneur to reflect on the progress and accomplishments over the past month as well as to plan out the coming month.
Length: 1-2 pages long
Format: directly include the details in email instead of as an attachment. Often the emails are read using mobile devices. So keeping the information short and focused is important. Include 1-2 pictures if relevant.
Structure: Include business and customer metrics; product, sales, and partnership progress; any asks from the investor community.
Template
<Intro / summary>
<Sales and Customer Metrics>
Key metrics are dependent on the type of business. Investors are interested in revenue metrics (MRR and ARR), Sales metrics (#customers, # organizations, # partnerships), and customer metrics ( # users, QAU, MAU, DAU). For each of these, include the metrics of the current period and past period. Include the % growth rate and do not make the recipient to compute it in their heads (they may get it wrong sometimes).
Below is an example of for ACME Inc.
| Metric | Current Period (March 2019) | Past Period (Feb 2019) | MoM Growth Rate | Notes |
| Customers | 120 | 100 | 20% | Added more New York City customers |
| Sales Pipeline | 390 | 300 | 30% | Social Campaign worked. |
| MRR | $1,280 | $1,000 | 28% | New premium feature is selling well |
| ARR | $15,000 | $12,000 | 20% |
<Marketing and Sales>
- Talk about marketing campaigns, CAC and LTV metrics
- Talk about Sales pipeline – be specific about prospects, trials, and conversions
- Partnerships
<Product>
- Learning from Customers
- Feature / product additions
- Upcoming features / requirements
<Asks>
Any asks for the community
<Summary>
Conclusion
In summary, I highly encourage startup founders and entrepreneurs to keep a steady stream of communication with their stakeholders. Doing so will build positive goodwill and also potentially opens doors for further investment and connections to customers or future employees.
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