How to Write a Monthly Update (Hint: Use Numbers)

Numbers always tell the story, so let them

I’ve alluded to the importance of data before (“Results Always Win,” “Tackle the Hard Stuff Head On”), but at Promus Ventures we continually see entrepreneurs sending decks and updates full of verbiage but lacking substantial numbers. Data should be front and center in any update or pitch, and in copious amounts.

Paul Graham hit on this exactly in a tweet last week:

https://twitter.com/paulg/status/407961403421503488

The more data that can be sent to those around the table, the more efficient key investors and advisors can be in helping/connecting and not wasting founding teams’ time getting up to speed on progress.

Don’t be afraid of showing data to trusted insiders, no matter how bad it may look at the time. For example, some highly anticipated numbers from a company in the Promus community recently came in way below what any of the investors thought possible. The update from the Founder and CEO of this company started with showing all of this data straight away, owning up to the failure, describing further analyses that were being done to learn more about what went wrong and what will have to change. Although the results were unfortunate, the way he handled this was A+ and the team is getting after the issues immediately.

Listen, nothing ever goes as planned, so why not learn as much as possible through the data and course-correct real-time? We’re all big boys and girls — let’s get all the numbers on the table, however they look, learn from them and figure out how best to move forward. The numbers are what the numbers are — can’t hoodwink anyone or put lipstick on them, so learn to deal with this reality.

Updates should be:

• Written with consistent structure and brief in length (no more than 2 pages).
• Sent monthly in earlier-stage companies and bimonthly/quarterly in later-stage companies (although early on it can seem like a burden, we continually hear from founding teams how much insight into the business comes out of this regimen).
• Sent around to your key investors, advisors and mentors.
• Stored in a cloud folder with all previous updates so everyone can go back and review earlier months (and let’s you see who’s reading them!).
• Full of bullet points, not paragraphs.
• Quick in writing, not take more than 1-2 hours to put the update together (hopefully most of this is data derived from systems already built).

There is no perfect update structure, but here’s some key areas:

1. KPIs/Financial Snapshot — all the key Income Statement, Balance Sheet and Cash Flow statement data. This should take an entire page. Build it yourself and watch it evolve over time. Include your projections for the month, quarter and year and how the business is tracking against these projections. List the KPIs that the team looks at every day. If done well, the weekly/monthly/quarterly trends will sing (and hopefully a lovely tune).
2. Customers/Users — status of conversations with key customers, partnerships, wins, CoCA, LTV (whatever applicable).
3. Product — updates, iterations, testing, schedule, and goals.
4. Distribution — what’s working and not, where going next, SEO, etc.
5. Team/Hiring — adds, changes, links to open job specs looking to fill.
6. Asks — tell explicitly how people can help the company right now.

Numbers always tell the story, so let them. Personalize and build your own updates from scratch and let the structure evolve as your business grows. Send out updates regularly and the muscle memory built through the process will serve the team well into the future. Let the data flow!