Sam HuleattPutting Out The Bat Signal: Activate Your Cap Table
Most founders miss the #1 way to get more value from investors. Founders typically focus on investors as sources of capital, but this overlooks the significant value investor can provide post-investment.
From my experience, early-stage startups tend to under communicate with investors.
This likely happens due to 1) a lack of awareness (”I never thought to ask my investors for things other than money!) and 2) the (false) perception of busywork (“writing investor updates takes forever and isn’t the best use of my time!”). In reality, learning how to systematize investor engagement creates a huge advantage for smart founders. It’s no surprise that the most proactive, communicative founders in my portfolio also have the best performing companies.
More Engaged Nodes = More Value
Founders generally have three categories of investors:
- Close investors (i.e., lots of 1:1’s and texting)
- Other investors on the cap table (i.e., receive your confidential investor updates)
- Future investors and company supporters (i.e., receive your public investor updates)
Naturally there are some investors you will communicate with more frequently (and surprise, small check investors can be more involved/valuable than larger check investors).
Think of investor communications as a chance to inform, but also to put out the "bat signal" — and ask for support. The bigger your network, and the more you know about it, the better your results will be.
This is the reason why many founders love to have numerous angel investors: they angel often can bring technical expertise, operating experience and their own robust networks to the table. It’s also why I have observed the trend of founders of opening a more public version of investor updates to supporter networks, and even investors who initially passed.
The Medium Is the Message
It doesn’t really matter whether you use a fancy platform, or regular old email to keep investor apprised. The fact that you do it at all tends to separate one startup from another. The best advice I have for updates is to keep it simple and metrics focused:
Regular, consistent communications
- Whether monthly, or quarterly, investors will look forward to following your story and progress. Consistent communication is so appreciated by investors.
- Regular updates also help avoid dreaded future ‘surprise’ emails where a company you haven’t heard from in two years suddenly need an emergency cash infusion.
Focus on metrics (not word count)
- Investor updates do not need to be long narratives pontificating on market dynamics and thought leadership.
- Investors want to know what you’ve experiments you’ve run, progress (or mistakes) you’ve made, and key milestones you’re striving to hit.
Convey Momentum & Learnings
- I’ve written extensively about the power of conveying momentum to investors. Your investor communications are one of your best opportunities to do this. Momentum does not need to be top-line growth or revenue. Momentum is also shipping product, conducting growth experiments, and reporting on what you have learned when things didn’t work.
Be Explicit with Your Asks
- If you want specific investors to help out, it can make sense to @mention names directly in your updates. While 1:1 texts or emails are good, establishing early on that investors should read your updates because you are making specific asks there, will help with investor accountability.
- In addition to asking specific investors for help, make sure you reward investors with public shoutouts when they have stepped up and added value.
Investor Update Examples
There are many templates and examples of investor updates on the web, but the best template is the one that you will send. As long as you are including a few key things, investors will be happy. Offering up too much information is unnecessary.
Metrics-wise, most investors want to see:
- Cash in the bank
- Monthly burn
- Runway (months)
- Team size
- Key KPIs like: ARR/MAU, signups, retention, etc.
- It’s also helpful to note the % increase/decrease from the last update
Here is a great example investor update from Emergence Capital. Here’s another.
Most startups don’t need anything more than this.
That said, one of portfolio companies, Levels Health, takes investor updates to a new level. CEO Sam Corcos is well know for his operational acumen and the updates reflect this. Levels also keeps a public archive of all their investor updates. I would say my favorite aspect of Level’s updates are not the depth of detail, but the consistency (I also love the Loom overview).
You can view Levels’ investor updates here:
Here is a great MorningBrew podcast with Sam on investor updates:
Reducing Friction to Help
Your investors are ready to help, but the process must be as low friction as possible.
Make Effective Asks
Consider three different approaches to asking for a customer introductions:
- “We want to connect with high performance engineering teams at series B companies”
- This ask is okay, but broad and non-directed
- “We want to connect with engineers at the following companies: company x, y, and z”
- This is better as investors can think whether they know someone at a specific company
- “Sam - I saw on Linkedin you are connected to X engineer. If I send you a forwardable email, would you mind introducing me?”
- This is the winner! It’s a specific ask and the forwardable email reduces friction
Use Forwardable Emails
Forwardable emails are gold. The practice greatly reduces friction for investors/supporters and allows you to control the message. For details on how to properly use forwardable emails, check out these resources:
- Raimond Kulbergs: how to get intros
- Alex Iskold on how to write a forwardable email
- Hustle Fund: get intros from VCs
Pick Your Investor Relations Tools
There are lots of platforms out there to send investors updates, but as I said before, the best tool is the one you will actually use. Examples:
- Email - Simple
- Notion - Offers templates and makes it easy to keep historic archives
- Visible.VC - Paid platform that many founders love
- Cabal - I used to recommend Cabal to all founders. While it’s still fantastic, the current pricing makes it such that is quite expensive for early stage companies.
- Private Substacks (or Beehiiv, etc) - Another popular alternative to email
Offer Incentives
Sometimes, a little motivation goes a long way:
- Use positive reinforcement, giving shoutouts to investors/supporters when they help
- If traveling to a city with multiple investors, offer to meet up for coffee, or a beer
- Cabal offers the ability to offer company supporters/advisors micro equity grants
Conclusion
Effective investor updates are an art form. They should be concise, clear, and action-oriented. Include forwardable requests — specific, easy-to-act-on items that investors can share within their networks. This approach turns your updates into a powerful tool for networking and resource mobilization.
Appendix
→ An overview of Cabal, plus general best practices on activating investors to help:
Daniel Gross’ Original Investor Update Post (via WayBack Machine)
