The Secret to Building Relationships and Trust with Potential Investors
May 24, 2018
by Anna

The Secret to Building Relationships and Trust with Potential Investors. 

Written by Dr Laura Faulconer

Keeping your investors updated after they have invested is important and there are lots of articles about how to best keep existing investors in the loop. The same approach can sometimes be an effective strategy for potential investors.

Pre- and post- investment updates share some common features- and post- investment updates share some common features:


  • Short, succinct and delivered at regular intervals even if things are not going as intended
  • Delivered by the same founder every time
  • Easy to produce (KPIs you are, or should be, tracking anyway) and easy to consume (use a consistent, simple template)
  • Transparent and data-driven, using informative real numbers across the same categories and metrics

Pre-investment updates curate trust

The number of opportunities that cross an investor’s desk and immediately get actioned into the investment pipeline is low.

Many otherwise promising opportunities enter the ‘wait and see’ bucket.   A well executed communication strategy, of which potential investor updates is one tool, could

move the needle towards deal momentum and keep your opportunity on their radar.

Proceed, with caution

If you decide to provide potential investors with updates, be aware that it can go awry.

  • If you start, be sure to follow through – demonstrate professionalism and reliability.
  • Data can be your friend, or your enemy – lacklustre progress against milestones, without pivots or a strategy rework, does not breed confidence.
  • Do not cherry pick what you share – sharing wins and setbacks builds trust, and demonstrates how you will navigate setbacks post-investment.
  • Not all investors will want regular updates. Ask the investor if they are receptive to receiving monthly short updates from you. Many will say yes, and not many will have been asked that previously.

Tips for crafting potential investor updates

Tip #1:

A system to ensure timeliness. Start by setting a calendar reminder to ensure regular updates and to prevent it from slipping to the bottom of your to do list. Monthly updates are the recommended interval.

Tip #2:

A system to ensure consistency. Choose a format that works for you (scroll to the bottom of the blog for a template) and stick with it. The metrics section is non-negotiable. There may be additional metrics relevant to your opportunity so consider what might help an investor decide to fast-track your opportunity through due diligence.

Tip #3:

An engaging email subject line. Emails can easily get buried, and if an investor is receiving regular updates, they might not prioritise opening your email straight away. Don’t use a subject line that is easy to ignore.

  • Use consistent formatting so it is easily searchable
  • Keep it short so it doesn’t get cut off
  • Highlight if things have really changed – perhaps you’re ready to come and pitch, or you have landed a big customer.

Here’s an example: “StartupX Update (FEB 20xx): Sensitivity tests indicate 10x gold standard”

Tip #4:

Change in metrics. By indicating month-on-month (MoM) change in metrics, it helps contextualise the data provided.

Tip #5:

Goals for the next update. What investors want to know is that you know how to set and achieve milestones. By regularly updating and demonstrating progress against your milestones, you can de-risk your team’s operational capability.

Template for pre-investment updates

[1-paragraph honest assessment of achievements, key learnings and failings over the prior month]


Revenues: [Target market entry date]
Burn Rate: [Sum of the expenses incurred over the previous month]
Fundraising Status: [Not raising / planning to raise / raising / seeking round completion / closed round]
Fundraising Details: [indicate raise amount, investment structure (equity / convertible note / debt) level of commitment (soft / hard), who is involved, etc.]
FTEs: [Number of full time equivalents, including founders]

[1-3 other critical metrics relevant to report against on the frequency of updates]

Bad news (What is keeping us up at night):

[Limit to max 5 bullet points]

Good news (What we feel good about):

[Limit to max 5 bullet points]

What’s next

[Maximum of 3 significant action items intend to achieve before next update]

These will get us closer to our next value inflection milestone, which is [insert measurable, significant milestone]

Thank you!

[Team member names, or top few if large team]

[Mobile number(s) of key point(s) of contact]


 You may put a bit of time into crafting the perfect ‘punchy and crunchy’, data-filled update and will not get a response. That is fine – do not stop sending updates. If an investor is no longer considering your opportunity, they will let you know.

 Having a solid potential investor update strategy won’t be a guarantee that you will get funding, but it can help build a relationship with that investor you can leverage. Investors know other investors and what isn’t right for one fund can be a great fit for another. Warm introductions are the best way in, so cultivate the opportunity.

 This focused, regular self-reflection is a great practice to make a habit, whether or not it leads to investment.