One of the best ways to make sure your board is informed and aligned is to share a monthly update. How you choose to approach this is totally up to you and your personal style. We’ve shared a few tips and best practices from our experience below.
For consistency and to share a clear picture around runway, many founders kick off each update with the following:
- Cash on hand
- Burn rate
💥 High Level Summary
High level observations and expectation-setting about the business and likelihood of hitting key business goals for the quarter/year (e.g. competition is heating up, product market fit is becoming clear, have begun to ramp conversations for a new round, etc.).
Bad News. We don’t expect any company to be “crushing it” all the time; in fact, if you never have bad news to share, it raises a red flag. Get the bad news out of the way right up front. Take it head on. You’ll gain respect in doing so. In his book, The Man Who Lied to His Laptop, researcher Clifford Nass proves that people also listen more actively when you start with the bad news first (debunking the myth of the “good news sandwich”).
If you don’t have a plan for how to fix yet, share what you are doing to develop a plan. Request help if needed. Never fail alone.
Good News. Celebrate good news, big or small. Your board/investors need an accurate view of how things are going, but they also want to acknowledge wins with you. If you’re getting confirmation that you are onto something, share it. Distinguish between things that are looking good, and things that have happened.
👋 Functional Updates
Hiring. Discuss new hires, departures, key openings and where you need help. Distinguish between burning needs (QA lead, ASAP) and important, but not urgent, hires (e.g. upgrade Chief Architect). This is where you demonstrate that you are not just focused on today’s issues, but are also thinking about scaling and “muscle-building” the organization. It’s also a valuable way to tap into your board members’ networks.
Product / Engineering. Are we going to hit upcoming delivery dates? Does it look like the product will perform as anticipated? Is the bug count rising or falling? Where are we doing well and where do we need to improve?
Sales / Marketing / Customer Engagement. This will vary greatly by stage. In the early days, it encompasses feedback from prospective customers on their view of your value proposition, customer adoption challenges you’re facing, a sense of where buying budget will come from (target customer). In later stages, share where you think you are relative to monthly or quarterly sales goals. How’s your pricing structure? Where are you getting stuck? Are sales cycles getting shorter or longer?
✨ Help Wanted
Start by summarizing the help you need across the categories above. Every CEO should have a couple of key priorities you are focused on at any given moment.
Openly ask specific board members or investors for help. Put them to work!
📈 Financial Update
From our perspective, it’s better to have flash reports (estimates) on a timely basis than to have “auditable” financials that are only available many weeks after the period. Align with your investors to identify the KPIs that are meaningful to your business, which might include:
- Monthly active users
- Fume date–some businesses are more bookings-oriented, others more revenue (or billings-oriented).
But Above All, Communicate!
Summarize the help you need across the categories above. Every CEO should have a couple of key priorities you are focused on at any given moment.
Ideally, it’s a reflection of what you are thinking about every day. It doesn’t need to be beautifully worded and formatted, it just needs to get your message across.
A good update can be written in 20 minutes. It’s simple and direct.
Pick a style that works for you, and give it a shot. After all, healthy companies start with healthy conversation.