Building a startup with integrity: Why investor updates matter

Venture Capital

At FundersClub, we typically sign one term sheet every two weeks, which makes us one of the most active seed Venture investors in Silicon Valley and beyond — since we invest globally. The net result of that is that we receive 2–3 companies updates a day, given we have over 190 portfolio startups.

Personally, I’ve been learning a lot from reading them. There is a clear correlation between the quality of the update and how well the startup is performing. Appreciable updates are the ones that are data-driven, short, but engaging. Supreme founders are top-notch communicators.

You should start with a short, 2–3 sentences executive summary, followed immediately by the most significant asks and requests. A common mistake I see happening is when founders leave the key asks to the bottom of the email.

Immediately after you should follow with Metrics and Key Stats that you look at to judge the success of the business. Keep them simple and easy to read, preferably with charts, posted directly as images to the body of the email.

The current update should go back to the past quarter or month and correlate data, historically. Two of the most disappointing things we see on updates are when there is no historical correlation between what is presented and what was accomplished or even worse when there are cumulative charts on the update.

Add a section for highest highs and lowest lows and finish things off with a special thanks section, so it subtly helps motivate other investors that might want the recognition.

Dharmesh Shah from Hubspot has a great pro-tip, that very few companies do, and we would appreciate: keep an indexable archive of all your updates. When I was building my first startup, I created a private Posterous Space for all investors, so they would have a private web portal that they could log in from any device and see our progress at any point in time.

Here is the basic skeleton for your update:

  • Executive Summary with 1–2 key metrics that stand out the most
  • Asks For Help
  • Metrics and KPIs with Images / Charts (all non-cumulative, please)
  • Highest-High
  • Lowest-Lows
  • Link to the Archive on Previous Updates


Updating your investors on a monthly basis is an important exercise of accountability that every founder should do. You should not miss a deadline or send late updates to your investors. Consistency on the frequency of each update is key. Best founders are transparent, data-driven, and keep text to a minimum on their updates. Additionally, they will not have a problem disclosing issues to investors. We are here to help and serve you. The worse thing that can happen to your relationships with your investors is when you take the "silent death" approach and decide to hide problems or skip on sending updates.

Never forget “dictum meum pactum”.

Special thanks to Boris Silver and Guille Freire from Trocafone. Our email exchange about investor updates is what made me write this post.

Here is a collection of the best advice and resources I found online about investors' updates:

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