Why Keeping Investors in the Loop is Your Secret Weapon

How regular emails from founders build trust and foster lasting VC relationships, even when you're not fundraising.

Founders, here are a couple of scenarios that might hit close to home: You pitch an early-stage VC who passes, but instead of staying in touch, you shift your focus to other investor outreach. Or you raised an initial seed round or two but only contact your current roster of investors when you’re 30 days from running out of cash, hoping for a last-minute save.

Do either of these sound familiar? If so, you’re missing a huge opportunity, says Tom Lazay, co-founder at Companyon Ventures.

“Too many founders go silent until they need money,” Tom told me last week.

However, regular updates can be a secret weapon for building trust and lasting relationships with investors, even those not on the cap table.

“Transparency is the best way to build trust,” Tom says.

I reached out to Tom after he shared a post on LinkedIn about a Medium article by Sahil S., who suggests founders regularly update investors, whether they’re involved in the company or not. The idea is simple: keep investors in the loop, show your progress, and be consistent. It costs next to nothing while it strengthens the connection and proves you can deliver.

Tom and I chatted over Zoom and he shared his experience with Knowify, a construction SaaS startup. Although Companyon passed on the company’s initial pitch for seed funding, Knowify didn’t disappear like Homer backing into the bushes. Instead, the co-founder/CEO sent regular updates.

“By the time they were ready for their next round, I felt like I had followed their journey for 18 months,” Tom says. This familiarity led to Companyon investing in the Series A round. And although this happened three years ago, the lesson still holds true.

Here’s the takeaway: as an entrepreneur, you don’t need to write a novel to stay in touch with investors. Keep it short. Just a few bullet points on wins, challenges and any asks. Think of it as a conversation, not a presentation. As Tom put it: “You don’t need a manifesto, just keep investors in the loop.”

This is gold, especially for early-stage founders. Regular updates keep investors engaged and can open doors when one may least expect it.

So, if you haven’t started, draft that update. As I’ve posted before (How to write your own blog and thought leadership pieces), consistency is the cheat code to writing. So aim for monthly emails, ideally, or quarterly communications at a minimum.

What’s stopping you? Keep it simple and stay top of mind!

And, as always, happy to chat if you have ideas to share or want to ask questions.

Artwork by Vecteezy.com.