Startup founders are told to write investor updates. You can search google for lots of articles about why. You can even find "fill in the blank" templates.

I’ll skim the advice for you…engaged, positioning, intros, want to help, in the loop, etc. You’ll notice a trend. All of the reasons given are to benefit other people.

I think that is bad advice.

Yes people in and around your business need to know what’s going on but investor updates aren’t the way to do it. If people want an update you can just email them this every day…"This is hard. I got kicked in the teeth again today and the hill we’re trying to climb looks more like a mountain. Please make more hours in the day and send help that doesn’t drain my bank account."

Instead try Business Updates.

What’s A Business Update?

They are similar to an investor update, but different. First, Business Updates are for you. Others read them, but the purpose is to help you run a more successful business. Second, they are about the past and not the future. We aren’t hyping. We’re learning.

Business Updates analyze the past few weeks. They force you to look at the data, ask what happened, and come up with new hypothesis’ to test next. They are uncomfortable, especially when something isn’t working. But over time you’ll come to realize they are the most important tool to teaching you how to think, distill, and run your business. Public companies write quarterly updates (i.e. earnings calls) and the best CEOs write annual shareholder letters (See Bezos).

It doesn’t matter if you are bootstrapped or venture funded. Business Updates teach you how to analyze and communicate results. I call this business speak and you need it to raise, hire, and scale. Because if you can’t distill your business then there is no way you can execute it.

That’s cool, but I just started my company so what am I going to write about?

Everything you’re learning. Even if your updates start as product specific learnings, that’s ok. It’s a start.

When do I start sending updates?

As soon as you can and BEFORE you raise money. These updates will demonstrate that you are serious about building a successful company.

How frequently do I write them?

More than once a month. Once the business is mature you can push out the timeline. I started with an update every other Sunday. Three years in, I moved it to every three weeks. And now five years in, I publish about once a month.

Who do I send them to?

The people closely involved in the long term success of your company. This includes current employees, investors, advisors, and board members. Yes, even board members get the same updates as everyone else. You don’t have time to send different updates to different people. Over time you will forget who you said what to, so it’s easier to just be transparent from the beginning. It will make sense later.

Are they a lot of work?

Yes, especially when you start. You’ll quickly realize that to write about your business you have to be able to measure it. To be able to measure it you need tools to track it. To have tools to track it you have to have thought about what to measure and why.

Eventually you come full circle to realizing…shit I have to prioritize learning into the foundation of the company.

Bingo.

Wait, so how do I keep my investors hyped?

You don’t. You let the numbers do the hyping.

Ok, so how do I get my investor to help?

Ask them. Learn how each can help and message them when you need it. Unless they wrote the largest check, they have limited hours to help. Therefore be selective and specific in your asks.

Huh, sounds like a giant waste of time.

It is…if you don’t plan to build lots of startups. It’s actually easier to just write investor updates than to write Business Updates. With investor updates you just keep writing about the amazing stuff you are going to do and you can skip over the actual results.

Business updates on the other hand require you to be vulnerable. You have to look at results, especially the shitty ones, and decide what you’re going to do about it. Not everything you will try is going to work. But the process of trying, measuring, learning, and improving will deliver.

Update Structure

You are welcome to make your own structure, this is mine.

Intro Paragraph

I take the biggest learning since the last update and elevate it to the top of the email. This provide me with space to dive deeper into a single topic to analyze what happened, what we learned, and what we do about it. This section can include a few charts / images and about 2-4 paragraphs of analysis.

Need Help

In the early years I would list a single ask. The more specific you are the better. Overtime I took this section out and just messaged people with specific asks as needed.

Business Update

The rest of the email is a repeating pattern of single metric/chart with a short paragraph of analysis. I’m not writing accomplishment check lists, providing functional updates, or talking about the future. Instead I go over the last two weeks, looking at our dashboards and asking myself…what happened…why…what happens next?

In answering my own questions I start to find interesting pieces of data. These are small learnings we can use to improve future decisions. As I find these threads I pull out a single piece of data, screen shot it, and write a short paragraph of analysis about it. This pattern repeats itself for a few hours until I’ve gone through what we’ve learned since the last update.

It’s ok if your updates are short to start. As the business matures you will have more to analyze and learn from.

Writing Style

The language in Business Updates is business speak. The best way to learn it is to read quarterly updates and annual shareholder letters from your favorite public companies. Bezos consistently writes the best ones and if you read them over the years you can see how he think and talks about his business.

My rules….

• No hyping.
• No promising the future or talking about what your’e going to do next.
• Only cover the past.
• One visual data point per paragraph of analysis.
• Be vulnerable. You don’t care if it’s good or bad news. Your job is to report on it, what you learned, and what you plan to do about it.
• Don’t try to have all the answers. You just have to talk out loud to what you’ve learned and put down your next hypothesis to test.
• Don’t hide shitty data. The results are what they are so dig into them.
• Don’t organize it functionally. Review and publish what you’ve learned about your whole business, not just the functional accomplishments. Because no one cares how you structure your business or what the functions are shipping. They do care about your results and the decisions you will make going forward.

Sending Details

Pick a cadence to send your updates and don’t waiver from it. Whether good news or bad news, you ship your updates. Consistency wins.

Your entire startup journey is an unproven hypothesis. The faster you realize that you have no idea about what’s going to work, the faster you start learning. The numbers won’t lie so don’t worry about hyping something that isn’t real.

No matter how you publish your updates what matters is that you ship and don’t waiver from what you started. The quickest way to lose investor trust is to stop publishing.

Here is how I send my updates…

• It’s an email. I used Mailchimp in the past and now I use Klaviyo.
• It’s a text based email, not a marketing email.
• I try to send it on Sundays around 4pm pst. I found open rates were better on Sundays.
• I put current employees, investors, advisors, and board members on the update.
• When new employees join they get added to the updates list as part of the company on-boarding process. The opposite happens when they leave.
• I also archive all of the updates on a private webpage so future members can go back and read what we’ve learned.

Intro Examples

I can’t post current examples because we share financial data so I went into our archives and pulled out a few example intros. These are examples for how I would start a Business Update.

Intro Example – 1

[screenshot]

iPhone X has arrived. Even though it’s just a phone, it is arguably the most advanced camera ever made. Good news for us, is that our gear already works with iPhone X so we can capture immediate sales. Our lenses work. Our Photo Case is available for pre-order. And a new Battery Photo Case is going to be announced 11/14 for pre-order.

[screenshot]

It seems obvious in retrospect but it has taken us years to learn how to launch our capture products on time with each new phone. From the products to the content to the commerce we’re getting faster at capitalizing on launch day. Comparing our results to last year, both in dollars and percentage growth, we see just how important it is to have compatible products to sell. Last year our products weren’t yet available for purchase, which had a dramatic impact on weekly sales. This year we’re in stock or just a few weeks away from shipping.

Intro Example – 2

Our 72 Hour Sale just about crushed us.

This year we decided to close for Black Friday weekend and instead offer a 72 hour sale from Monday – Wednesday of the following week. The response blew past our most aggressive forecast, bringing in $270K on the first day alone. Comparing orders placed this holiday season to last season we saw 743% year over year growth. (Keep in mind we recognize revenue when we ship).

[screenshot]

This result was both amazing and terrible. On one hand it was amazing to have thousands of customers interested in buying Moment. We reached a level of momentum and excitement that surpassed even our biggest days on Kickstarter. On the other hand we instantly sold out of key products, which left little for customers to buy on the last day. To make matters worse we accepted some orders that were beyond our stock on hand.

Since the sale ended we have been in overdrive restocking products, releasing shippable orders on a daily basis, and managing a massive load of customer service emails. Backorders have been the largest contributor to the massive volume of emails we have received this season compared over last year.

[screenshot]

Despite dealing with backorders the team has managed to keep our customers happy. Which is never easy when thousands of people are anxious to have their order shipped.

[screenshot]

We are almost out of the woods as we expect to ship all open orders early this week, just in time for the holidays. Even though we haven’t had time to recap the holiday season one thing is clear, we left a lot of sales on the table by running out of stock.

Forecasting and inventory management is clearly an area we need to improve upon in 2016.

Intro Example – 3

It’s good to be shipping.

Launching and running a Kickstarter is exhausting but shipping might be even worse. Over the last three weeks we have shipped 12 new cases, four new lenses, and a new lens adaptor with two different suppliers across two warehouses, while using airplanes and boats to move the product. To add to the shipping complexities we received 7,150 emails alone in June, up 62% from the previous month.

Despite the stress of delivering we’ve managed to maintain a customer service happiness score of 85/100, reduce our first response time 3.5 hours, and reduce our overall response rate down by 27%. The whole team starting their day by answering 5-15 emails has made Kickstarter a massive team effort.

Best of all, the initial response to Moment 2.0 is higher than any previous launch. You can see the #momentgear feed or find YouTube reviews like the one below.

Business Update Examples

These are snippets from the middle of the update. It shows examples of analysis with a screen shot of data. I didn’t include actual screen shots so you’ll have to imagine. But generally I post a single chart.

Now that we are installing RJ Metrics we can begin to understand the business even better. The basis of our thesis is that Moment can grow to be a company with one million customers who on average spend $100 a year. Not counting our latest Kickstarter campaign we have passed an important milestone of our first 10K customers who on average have spent over $125 with us.

[screenshot]

In selling out of our Wide Lens we’ve quickly realized the impact of our best selling product. Looking at the items per order over the last few weeks with and without the Wide Lens, it becomes clear to us that a lot of people come to Moment to buy the Wide and in the process by other items. This makes its absence greater than just the direct loss in sales.

[screenshot]

Adding our first US warehouse continues to prove that people want cheaper, faster shipping. The conversion rate ratio between US and International reached as high as 5x during the peak holiday season. Adding Amazon FBA in the coming days will offer Prime shipping for Moment products for US customers. Next we’re working to move our international warehouse in-region, to reduce the tax and shipping shock our customers experience at check out.

[screenshot]

We have maxed out performance on the current platform and the only way to make speed and shopping improvements is to move platforms. While making that move, one of the key learnings over the lats month is that what we place “above the page fold” matters. A few months ago we tested putting add-on accessory products below the add to cart button, i.e. below the fold. Our items per order dropped significantly. Moving those accessory items back above the fold has resulted in much higher attachment rates.

[screenshot]

What has surprised us the most about being on Kickstarter is that our existing sales have not tanked. We figured the introduction of new products would bring existing sales to a halt. Instead the announcement of new products has only increased overall sales, now averaging about $15K per day. This tell us that next time we should go faster in designing and announcing new products. [screen shot would go here]

Extra Tip

Writing a business update isn’t just for the CEO to do. You can ask the same of your leadership team before every board meeting. Instead of making slides in deck have them each write a short business update about what they’ve learned since the last board meeting. This teaches your own leadership team business speak and how to analyze / distill their work. You’d be surprised, but this skill is not done. Even experienced operators don’t know how to write tight business updates.

Before each board meeting, the leadership team writes a collective business update. It goes something like this.

Intro

The first page is mine to summarize the business and the traditional areas around cash, revenue, margins, spend, and team.

By Team

Each exec writes their own section. The template varies a little bit but generally the premise is to analyze what they have learned.

• List annual goals at the top of the brief and mention if ahead, on track, or behind. This reminds the board what the team is focused on.
• Go through their business and talk about 5-7 learnings since the last update. Each short paragraph is focused on a single core metric / learning that they analyze.
• These sections are written in business speak and not product speak. That means they are using business words and writing about the impact of their results.

Discussion Topics

At the end of the update I list 2-3 discussion topics for the meeting. We spend at least two thirds of the meeting on the discussion topics.

….hope this post helps. Please feel free to copy or use any of it to run your company.