Communication and engagement are key ingredients to maintain a positive and constructive relationship with investors. From the pre-campaign phase to the post-campaign never stop talking with your investors.
Once you decide to start an equity crowdfunding fundraise it is very important that you nurture the relationship that you build with your existent and potential investors.
Communication and trust are two main ingredients for a successful relationship and campaign. An investor that believes in you and the offer will understand your objectives and spread positive information about your business.
Some companies hesitate from pursuing equity crowdfunding because they think the task of managing all their new investors is complicated and time consuming. However, if you are proactive and regular in your communications with your investors, they will be less likely to contact you with superficial queries. It’s a game that is worth playing. Engage with your investors, foster trust through transparency and make them feel valued.
Ensure the company is easily reachable and listen to all the advice given as your investors can provide the right expertise and connections to enhance your startup.
When to engage with investors
You need to engage with your investors in each step of the crowdfunding campaign so they feel confident that their money is valued.
It’s important to continue to engage with them when you are not actively raising money; to relay news about the company to reaffirm that their investment was positive and to show them that you don’t think about them only when you need to raise money. After the campaign, you can relax for a while, but you cannot suddenly stop the communication with who have trusted you with its money.
How to engage with your investors
- Milestones: tell your investors about good news so they can celebrate with you.
- Send regular updates: send a concise monthly email to provide investors with an update and overview of the company progresses, opportunities and challenges. In this way, you will minimise the amount of work that contacting every single investor would require and if in the future you will need further funds they will understand your reasons. Create an online portal on your website where they can find all the reports they might want to read.
- Maintain a strong working relationship. Don’t communicate with your investors only by phone or email but try to schedule some in-person meetings in a casual setting. Remember that they want to help and interact with people, not with companies.
- Prioritise: an unspoken rule is that you should engage more often with the investor who has led the last round of your financing.
- Share both the good and the bad: if things are not going that well, don’t write a long email full of explanations and promises; you want to transmit transparency, not anxiety. Be honest and frank; this attitude will improve your credibility. Remember that equity investors are aware of the risky nature of startups.
- Use the right content: creating relevant and valued content will help to keep your investors more engaged with your company, keeping you top of mind and encouraging positive word of mouth. Another bonus of engaging content is that non-investors might see it and be interested in investing in the next round.
The result of your crowdfunding campaign should never interrupt the relationship with your investors and constant and consistent communication with your investors is the key to build a strong network around your business.