How can you maintain investor and stakeholder relationships?

The investor / founder relationship should be an equal, two way relationship; anything less is falling short of what can be achieved. Having open, honest and frequent dialogue is essential. Knowing the strengths of each investor, their availability and level of support, as well as their level of interest is key. I have experienced investors that simply want monthly or quarterly updates, who sit alongside active investors that provide sector or governance experience. From start up to high growth funded business, the investor dynamics are likely to change and mature as the business does. As with anything, through these changes, honesty, transparency and expectations should be communicated. Tip: discuss expectations BEFORE investors invest!

Maintaining investor and stakeholder relationships is a lot like tending a garden. It requires regular attention, communication being the water that helps these relationships grow. Transparency and honesty are your sunlight, providing the right environment for trust to blossom. Nourish them with consistent performance updates and invite feedback like a gardener welcomes spring. But remember, just as a garden can't thrive on water and sunlight alone, relationships need the fertilizer of respect and understanding. So, grab your gardening tools and let's grow a blooming business!

Starting with clear, realistic goals is indeed pivotal. Such goals become a cornerstone for all stakeholders, aligning expectations and acting as a north star for your start-up. Having measurable KPIs directly linked to these goals, and keeping these updated, ensures everyone is on the same page. Furthermore, it demonstrates your seriousness towards delivering value and enhances your credibility as an entrepreneur.

In today's corporate landscape, the challenge of fostering substantial dialogues with investors about governance matters has become increasingly evident. Strikingly, these discussions often seem to pale in comparison to the more routine conversations centred around short-term performance metrics. Various explanations are put forth to rationalise this disparity, yet a fundamental incongruence between investors professed emphasis on long-term governance and company’s real-world interactions with them is hard to ignore. A recurrent motif is the prevailing notion that poor governance only brings forth negative consequences, while the prospect of showcasing commendable governance practices seems to offer limited or negligible benefits?

The cadence of your investor updates is critical. If you are a year plus away from fundraising, updates should be no more than quarterly. It may be overkill if an investor has had ten update emails from you before active round conversations begin. Quarterly updates will provide an excellent 2/3 touch points with much more material progress. Once the planning for the round starts, increase the cadence and include updates on how the round is progressing.

For most startups, the key to investors' communication is actually communicating. Only a fraction of the companies I invest in send any updates. Those are the ones I will continue to care about. Companies must realise that investors put a lot of faith in the business for a delayed gratification measurable in years and may never come if the business never exits. A continuous update of 2-3 X a year will go a long way to maintain the trust, and they are more likely to support you when you need them next.

Speaking to Lauren's point: Investor updates are critical in maintaining relationships between your team and me(s)[your investors]. The last thing we want to see is a 'hail mary' email, and if you are bringing us along the entire journey, including the pitfalls, you are putting yourself in a position where your investors are ready and willing to help if (but honestly when [ever so often]) the road gets bumpy... We don't want to hear about it last minute. Always manage expectations and be honest, it can help you solve problems before they reach critical mass...

Sending Monthly Investor Updates is one of the most important founder habits you should develop. I can’t remember them enough. Regular updates serve a number of critical functions: - It keeps you and your team honest energized towards hitting goals - It brings investors along your journey so they’re more likely to want to help and /or invest in future rounds - It helps identify gaps or problems early so they can offer help or intros before it’s too late - It provided an easy way to ask for help and intros along the way - you never know who is in your investors network; and they can’t help if they’re not updated on what would bring value. I use Notion to keep the updates organized, interesting, and fun!

I couldn't agree more on the importance of regular, transparent communication. It not only keeps stakeholders informed but also builds trust. Crucially, it shows that you value their involvement. Being upfront about challenges and setbacks may seem daunting, but honesty often yields constructive advice and additional support, transforming potential negatives into opportunities.

The important thing here is to communicate even if the milestones aren't fully achieved. Founders tend to shy away from breaking bad news and eventually, it becomes a significant (negative) surprise for the investors.

Delivering on promises and milestones is essential. It indicates your ability to execute plans, turning vision into reality. Demonstrating evidence of impact, traction, and growth provides the assurance that stakeholders' resources and support are being effectively utilized. Beyond building trust, meeting targets also strengthens your startup's credibility and positions it positively for future investment rounds or strategic partnerships.

Seeking feedback and advice is a smart strategy. It underscores your respect for stakeholders' expertise and willingness to learn and improve. Moreover, stakeholders often feel more connected to the startup when their opinions are valued, fostering stronger relationships. Cultivating personal rapport in addition to professional interactions also contributes to building a sense of partnership and shared journey, pivotal for long-term collaboration.

Managing relationships in an open innovation setting is crucial. Here are 7 tips to help you: 1. Clear communication: Maintain transparent and open lines of communication. 2. Build trust: Focus on building rapport and positive relationships by being reliable, honest, and delivering. 3. Encourage collaboration: Encourage sharing of ideas, insights, and expertise. 4. Engage stakeholders: Actively involve stakeholders throughout the process. 5. Reward contributions: Celebrate successes, publicly give credit where it is due, and offer incentives. 6. Manage intellectual property: Clearly define agreements and expectations regarding IPR. 7. Foster a learning culture: Promote knowledge sharing, reflection, and encourage experimentation.

Opening your weaknesses is a strong way to build relationships. If you have partnered with the right investor or stakeholder, they will try to help. Usually we try to hide or mask our weaknesses due to fear of raising an issue. When you have chosen properly who to work with, the effect will be the opposite.