The art of the investor update

Every founder should be sending investor updates. They are an easy way to help your business win.?

In this article I’m going to go through:?

• When you should send updates?
• Why you should send updates?
• What to include in them?
• An example investor update from a real startup

My biggest piece of advice- start sending updates NOW. No time like the present! There’s no need to wait to have investors, if you are building a company, it’s time to start sending them.

In my opinion, it’s best to send an update once per month, but folks can flex upon need.?

Whatever pace you choose to send updates, the most important thing is to maintain consistency. Don’t go ghost mode!?

Here’s why you should start sending investor updates now (whether or not you have an investor):

1. Makes you comfortable with the practice of writing them. Writing a spectacular update can take practice and it never hurts to start honing in on your founder voice and your company ‘story’.
2. Forces you to track KPIs, set goals, and share progress toward goals. I find that when most folks start building, they are oftentimes building into the void and have a hard time staying focused. Sending these updates can help you stay on track because you know people important to your business are tracking your progress. All of the sudden you’ve verbalized a north star and you have to keep sharing how you are pointing toward it OR how that north star has changed given what you know now.?
3. Allows potential investors to passively track your progress. It’s not uncommon for an investor to want to ‘get to know’ a founder for 6-12 months before making an investment. Investors are always fearful that founders won’t get enough traction, will lose focus, or will quit. Continually sharing updates helps them keep tabs on you and slowly start to underwrite for those risks to hopefully invest later.
4. Builds you a community of supporters. Speaking for myself here- when I receive a regular update from a company, I feel more committed to what they’re building than a company that I don’t receive any updates from. Find a way to get the people who want you to win involved in helping you win. Nobody builds a company without help along the way!
5. Makes it easy to ask for help from a group when you never know who could be helpful to you!? You might know who to turn to for a problem with your UX design or hiring for a specific role, but in building a startup, there will always be problems that come up that you don’t have the answers to. And you never know who might be in your network or who they might have in their network to help you. It never hurts to start asking.

When you do have investors, it’s great for a few additional reasons:

1. Builds transparency and trust. Regular updates can show investors that founders are being transparent about their progress and challenges. It helps you maintain a healthy relationship more passively. When you do meet with investors, you can focus on where you need the help and less on where you are at since they should already be able to track the high-level information.?
2. Red car syndrome. I made this up, but I’m a big believer in it. People have very short attention spans and focus, you need to keep reminding them about what you are trying to do and how you need help. For example, I invested in a startup that sells to manufacturing companies. What the hell do I know about manufacturing companies? Absolutely nothing. But this founder is really good at staying top of my mind and that has led to me making several customer introductions. If you give people a red car to look for, they are more likely to find a red car. Just keep giving them red cars in your investor updates.
3. Alignment. You can get alignment on your company's vision, direction, and KPIs in many ways, but I am biased toward the concept that writing them down, reiterating them regularly, measuring them, and reporting on them to other people will solidify them even more and help you stay focused.
4. Future fundraising. You can use your investor updates to keep investors engaged. It also can help you with your current investors to remind them to keep recommending your company to others.

What you should include in your investor updates:?

1. Put a TLDR. Include the 1 important thing. This is for lazy people so at least they know 1 thing about your company lol.?
2. Remind folks of your mission, vision, why etc (whatever you call it).?
3. Update on KPI progress compared to your goal KPIs
4. Product updates?
5. Team updates. Any new hires, people you are trying to hire, internal changes.?
6. Any fundraising progress or needs.
7. Wins?
8. Challenges?
9. Where you need help?

Example investor update.?

I think Cooper Lycan at SoBet is the GOAT of investor updates. I look forward to reading them and I think other folks do too.?

Cooper does a few things well. In terms of some basic pieces, he reminds people of why they are doing this/what they are doing, he goes into details on their progress, and he always asks for help. What Cooper is exceptionally good at is sharing their priorities and establishing a voice as a founder and a leader.?

Here is a real investor update he sent that I think provides a great framework for other people to follow:

SoBet Team -- Update from the past month (May '24). TLDR: we had another month of significant growth, brought on a professional design team to improve our ui/ux and had a busy month on the content side with multiple live event opportunities for the team! Thanks for the continuous support. Here’s a link to our monthly all hands.?

SoBet helps bettors elevate their game. We are a brand and a product.?

Build. Win. Repeat.

High-Level Updates

- Product: Download the app here. Our goal this summer is to improve our processes during the 'low season' to build for exponential growth and scalability during the football season. One aspect we're improving is our development flow and specifically bringing professional designers into the room. To date the app has been mostly designed by Bhavik (Lead Engineer) and tweaked with feedback from the team. We plan to overhaul our ui/ux, to improve the user and influencer experience within our app, in order to increase long term retention and discoverability within the platform. I'll share updates as we make them, but if you're on the app, you should see changes rolled out incrementally this summer. Other than design, major features we're still working on are our X and X.

- Ops: We're bringing on an experienced operator in a limited capacity to help automate some of our systems on the ops side of the house, specifically tracking financials. Part of that improvement is going to be to help visualize and track some of the MoM numbers across the board. I'll have our typical Q2 update going out at the end of this month, but a big improvement should be charts and visuals.?

KPIs (Key Performance Indicators)

- April KPI Update:

Gross Revenue - $XXX (X% increase from April, down $X from all time high in March)

Net Revenue - $X (X% increase from April, all time high)

MRR: $X (X% increase from April)

Profit Margin: X% (X% increase from April)

Current Active Paying Users: X (X% increase from April, +X past 7 days, +X past 30 days)

Average Revenue Per User: $X (X% increase from April)

Subscriber Lifetime Value: $X (X% increase from April)

Subscriber Churn (Monthly): X% (X% decrease from April)

12-Month Retention: X% (X% decrease from April)

6-Month Retention: X% (X% decrease from April)

Paid Ads CAC: *We've currently turned off our paid ads?

→ For clarification based on some questions/feedback, SoBet is not involved in real money gaming. Users pay $9.95 per month to access our platform using a recurring subscription. Our 'MRR' is a reflection of current recurring monthly subscription revenue (and longer term subscriptions) and does not include cancellations. We report this metric the same as any other B2C SaaS platform would report it.??

Wins

- Win: We sponsored the US Women's National Alumni Team in TST (The Soccer Tournament), thanks to some help from some of our investors. TST is essentially a large semi-pro soccer tournament where the winning team receives $1mil. Bryce (Head of Content) and GutsyPicksCash went to Cary, NC to be on site for the entire tournament, which turned into an incredible experience. Not only did the US Women's Tieam win the entire tournament, but we made over 20 short form videos, and saw over 50,000 impressions across all social from the content filmed. (More below)

- Win: SoBet finalized our deal with the PLL to run back another summer of content and betting for them. We hit the ground running by attending their street lacrosse event in April and shooting some content. And then Wes Huber (Head of Brand) and more creators attended the PLL's most recent weekend event in Charlotte. This summer our goal is to create viral content, impressions and outreach for the PLL, through tapping into our betting related audience. Our team showed out in Charlotte to kick things off. Shout out to those guys.?

- Win: We hired 6 interns who have joined us across various capacities for the summer. Shout out to Ron (CTO) for heading up the onboarding process, and everyone else for finding some great candidates. Excited to work with them and grow the team.?

Help We Need

- Intros: Any introduction to brands, leagues or other organizations within the sports/media realm that could be beneficial!

Our Priorities

- Continue building the best product for our users/influencers

- Learning from our mistakes and being agile

- Exceeding our revenue projections to stay on a trajectory towards break even (by growing our revenue/increasing our revenue streams)

My notes: It's really awesome to see SoBet continuing to grow during the low season. Right now we've already outpaced our expectations for Q2 and we still have 20 days left. We should continue to see marginal growth over the summer. Compared to last summer, it's already been a lot less angsty too. Last year at this time, I think we had around $250k in the bank, we were scrapping and clawing to make it to football season, and were gripping onto a life line thrown to us by Jordan, Andrew and the Techstars Sports team in Indy. To compare it to something in real life, at that point in time SoBet felt like a 4 speed that had been driven for 200,000 miles already, and we were rebuilding the engine while we were driving. This June, it already feels like a brand new 8-speed. The team is moving faster, improving daily, and overall just showing incredible growth that is even hard to explain in a tangible way. I can't tell you how impressed and proud I am of our team. I say it a lot but I'm truly lucky. We have a lot of work to do but is incredible to think that two years ago we had a shitty blog website and 100 users. A lot can happen in two years.

I've always believed that the best teammates and the best leaders make everyone around them better. So that's the culture we've tried to build at SoBet. I think THAT culture is truly starting to take shape. Here's a small example I saw recently:

TST - Bryce Smith (one of our influencers brothers) was brought on board as Head of Content full time in January. It was kind of a gut hire for me, because he moved to Nashville, would take a bullet for SoBet, and I just had a feeling he was a quick learner. But honestly, he had very little experience with creating and distributing social content. So it was a big risk. Fast forward to today, our social strategy has done tens of millions of impressions and grown exponentially across all platforms over the past 6 months. Huge success on paper but those details are aside from this story which highlights something numbers can't.

In April, one of our investors came to us with an opportunity to sponsor a team in TST. I was initially ecstatic about the deal. I envisioned a weekend of SoBet on the ground in NC, filming content and showcasing the unique sporting event. However, when I looked at the calendar, I realized I wouldn't be able to make the trip in person because I had a pre-planned family obligation.? I thought about canceling on my family, to micro-manage the sponsorship and make sure everything went as planned so that we maximized the golden opportunity. But I quickly realized doing that wouldn't help build the culture I was trying to implement. So I told Bryce that TST was on him. From start to finish he was in charge of making sure everything went smoothly and the ultimate goal was to make an impact on the tournament through our brand and content. Pretty broad guidelines for a guy learning it all on the fly.?

Yesterday morning I flew to Cary, NC on a last minute whim to see the US Women's team, play in the championship of TST for a chance at the million dollar prize. After a grueling 5 day tournament, our team had made the championship which was to be a highly showcased game on ESPN. Bryce and GutsyPicksCash (SoBet Pro), who had been at TST for 4 days already grinding on content, picked me up from the airport right before we had to go to the stadium. As we walked through the gates with media a passes, and VIP wrist bands, I quickly started to realize that both of them knew every single person in the entire facility. Decked out in SoBet gear we bobbed and weaved around the stadium pre-match, shooting content and interviewing players. And then, as it got closer to game time, we watched from the field side VIP box as our team won the $1mil tournament prize in front of over 20,000 fans. After the game all the players, coaches, tournament admins, and other people I couldn't even ID, came up and hugged Gutsy and Bryce. Thanking THEM for their work, dedication and support over the course of the weekend. I was blown away. When I gave the reigns to Bryce I honestly didn't envision the type of success I was able to witness with my own two eyes in Cary. They both truly made an impact on so many through their content, enthusiasm and candor over the 5 day event. And they did it with SoBet on their chest. Such a proud moment for me and such a cool opportunity.

Follow our Instagram page to see the content from the weekend. More will be coming out soon.?

As Ron says, you can't build culture, it's something that emerges. Seeing that emerge in front of my own two eyes is just really special.?

- Coop