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Timing is Everything: How Often Should You Update Investors?
"Time is money," as they say. Although it may sound like an exaggeration, there is truth to this. If you choose the wrong time to update your investors or even forget about them for some time, you can wave goodbye to your secure funding and their trust. So, how often should you reach out to your investors to keep them in the loop and ensure the success of your venture?

It's important to understand that every business and investor is different, so there is no one-size-fits-all answer to this question.

But there are some general guidelines we have deduced that can help you determine the best timing for your updates.

If you have a small startup at an early stage, then the rule "the more, the better" applies. Updating your investors more frequently may be appropriate if you are just starting, and every further step can lead to success or rapid failure with the same probability. Giants like Techstars and YCombinator send investor updates once a week. The accelerator requests frequent updates to understand the company's progress better and to be informed of any changes in plans. And, of course, for the founder to have self-awareness.

As your business grows and you develop an MVP and hire more people for the team, the frequency of your updates may decrease. For example, provide monthly updates if you are already preparing to launch your product or service. Remember to include plans for it, such as how many sales, new users, or installs you expect, the marketing expenses, etc.

Always consider what you are doing at the moment. For example, providing updates more frequently if you have major business developments is important. However, if you share more routine information, such as progress reports after launching a new product, it may be appropriate to provide updates less frequently.

But the rules of the game are different if you have a business in a more risky field or the industry is highly regulated. The investor stakes are higher, so it will be best for everybody if you provide more frequent updates. This will help them feel more secure in their investment. And this way, you build trust, ensuring the business will thrive in the long run.

Remember to COMMUNICATE. Always make an agreement with the investors on how often they want to see your updates. All in all, they put their trust and finances in your startup, so you have to respond in kind. They are your first source; recommendations from the internet should be the second. Ask investors what they prefer, and then adjust your update schedule accordingly.

Investor updates also help to keep existing investors engaged and informed about the company's progress, which can help to strengthen their commitment to the company and increase the likelihood of their participation in future fundraising rounds.

The key to determining the best timing for your updates is to balance keeping your investors informed and not overwhelming them with too much information.

Remember that investor updates are about more than just emails. Use a variety of communication methods to reach your investors. This can also include Zoom calls and in-person meetings. This will help you connect with your investors more personally and allow them to ask questions and provide feedback.

In conclusion, timing is everything when it comes to updating your investors. The stage of your business, the level of risk involved, and your investors' wishes can all impact the frequency of your updates. Remember to be responsive to their needs and concerns, and always be open and transparent in your communications.
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