Reporting

QuickBooks Report Template In the words of Tomasz Tunguz, Partner at Redpoint Ventures, “Financial statements are the Rosetta Stone for a business. They are the most succinct way of communicating how a business operates to management teams and boards, who weigh the trade-offs of different investments”. Distributing your financials to your team, investors, and board is vital to staying on top of your operations and uncovers insights for bringing a new product or service to market. Using our Quickbooks data source, we put together an Update template that will allow you to easily visualize and distribute your key financial and operational data. Currently, our Quickbooks integration allows you to pull in the following metrics: Cash Customers Employees Expenses Months Runway Net Change in Cash Net Income Payables Receivables Revenue Check Out the Template Here >>> When sending a financial and operational Update it is important to make sure the information is understandable, relevant, reliable, and comparable. Many team members, investors, etc. are likely not concerned about granular data points but rather that they are moving in the right direction and are efficient as possible. Instead of overwhelming stakeholders with spreadsheets and complicated metrics, we’ve often found that it is most useful to send over a few charts with a quick narrative around what is working/not working/etc. For those looking to take it to the next level, it can be useful to include benchmarks and trends in the industry to show how certain metrics and financials are comparing to the industry as whole. The template is broken down into 3 major components; Operational Overview, Expense Overview, and Other Notes. Keep in mind the financials you are tracking and sharing may change depending on the stage of your company; revenue is obviously not as important for a pre-revenue, early stage company. For our example, this includes revenue, cash position, and a high-level look at company expenses.

The Race to a Trillion Dollar Market Cap Between the unofficial race to the first one trillion dollar company and the recent acquisition of GitHub we decided it would be an interesting time to look at Microsoft’s most recent shareholder letter. Recently passing Google’s market cap for the first time in 3 years their acquisitions and focus on “the cloud” (doesn’t hurt to purchase the company behind the largest repository of open source software) have proved to be a large factor in their push to $1T. All of the charts, images, quotes, and emphasis below were added by us. Note: there may be removed sections of portions of the letter below. You can find the original 2017 Microsoft Shareholder Letter here. PROGRESS AND OUR RESULTS We delivered $90.0 billion in revenue and $22.3 billion in operating income this past fiscal year. Adjusting for Windows 10 revenue deferrals and restructuring expenses, revenue was $96.7 billion with $29.3 billion in operating income. According to Morgan Stanley analyst, Microsoft will need to grow their revenue by 46% to $136B and net income to $46B to reach the trillion dollar threshold by 2020. We continued to invest in innovation and expand our market opportunities, while maintaining our commitment to shareholder return, which included total cash return of $22.3 billion this year. Our commercial cloud annualized revenue run rate ended the year exceeding $18.9 billion, up more than 56 percent year-over-year. Our cloud growth puts us squarely on track to reach the goal we set a little over two years ago of $20 billion in commercial cloud annualized revenue run rate in fiscal 2018. “With Public Cloud adoption expected to grow from 21% of workloads today to 44% in the next three years, Microsoft looks poised to maintain a dominant position in a public cloud market we expect to more than double in size to (more than) $250 billion dollars.” – Morgan Stanley Analyst Microsoft is doubling down on their cloud efforts and are expecting for strong growth with corporate usage for Office 365 and Azure. The strength of our results across our reporting segments reflects our accelerating innovation as well as increased customer usage and engagement across our businesses More than 100 million people use Office 365 commercial. More than 27 million consumers use Office 365 Home & Personal across devices. More than 53 million members are active on Xbox Live. More than 500 million LinkedIn members use the LinkedIn network. Windows 10 is active on more than 500 million devices around the world. Dynamics 365 customers grew more than 40 percent year-over-year. Azure compute usage more than doubled year-over-year. As of June 14, 2018 the market cap for each company is… Microsoft – $783B Apple – $946B Amazon – $832 Google – $806B LOOKING FORWARD: OUR EXPANSIVE OPPORTUNITY A new technology paradigm As you can begin to see in the examples above, a new technology paradigm is emerging, one with an intelligent cloud and an intelligent edge. Microsoft will lead this new era. There are three characteristics that define this shift. The first is that the experience layer is becoming multidevice and multisense, where a person’s experience with technology will span a multitude of devices and become increasingly more natural and multisensory with voice, ink, gestures and gaze interactions. Second, artificial intelligence (AI) will be pervasive across devices, apps and infrastructure to drive insights and act on your behalf. Third, computing will be more distributed than ever before with compute power at the edge, whether it’s the connected car, the connected factory floor or any connected device. As developers write new applications for this paradigm, they need new mechanisms to manage the complexity of distributed, event-driven computing. Microsoft made a big splash with their recent $7.5B acquisition of GitHub. The acquisition stays in line with Satya Nadella’s focus on the cloud and open source projects. GitHub has already had a large presence in enterprise sales with GitHub enterprise and will be able to tap into Microsoft’s massive enterprise customer base. With the continued growth of public cloud usage Microsoft is looking to grow their strong position in the space. With this new paradigm comes new opportunity. Every customer is looking for both innovative technology to drive new growth and a strategic partner that can help them build their own digital capability. Customers are looking to change how they use digital technology and to reimagine how they empower their employees, engage customers, optimize their operations, and change the very core of their products and services. They are building their own digital systems of intelligence to drive growth. Microsoft is uniquely positioned to capitalize on this opportunity with the combination of our technology, partner ecosystem and culture of growth mindset. As we look ahead to fiscal 2018 and beyond, we will focus on bringing our technology and products together into experiences and solutions that deliver new value for our customers. Going forward, we will focus our innovation and investments in areas where we see the greatest opportunity for growth. The modern workplace The workplace itself is transforming — from changing employee expectations, a widening skills gap, more diverse and globally distributed teams, to an increasingly complex threat environment. The productivity experiences and tools we deliver will unlock the creator in all of us and enable seamless teamwork not just in the workplace, but also at school and at home across all the devices people use — from the phone to the laptop to mixed-reality headsets to the whiteboard. The Microsoft Graph, which provides the underlying data model of the user’s experience, and the LinkedIn network, will make it possible for every professional in any business or functional role to be much more productive in getting things done. Enter Office 365, Windows 10, and LinkedIn. Office 365 currently has 100 million users and is expected to double to 200 million by 2020 on top of LinkedIns already 500m users. Applications and infrastructure Cloud computing is foundational to enabling digital transformation for any organization. Beyond being a trusted, global, hyper-scale cloud, what makes Azure unique is our hybrid consistency, developer productivity and SaaS application integration. Our hybrid infrastructure consistency spans identity, data, compute, management and security, helping to support the real-world needs and evolving regulatory requirements of commercial customers and enterprise-focused SaaS ISVs. Azure Stack is an extension of Azure that enables developers to build and deploy applications the same way whether they run on the intelligent cloud or the intelligent edge. With Visual Studio and Azure Services, we provide the toolchain and application platform for modern DevOps that helps organizations with their agility and productivity — and enable them to use the best of the Windows ecosystem and the best of the Linux ecosystem together. Azure enables SaaS ISV developers to reach 100 million plus enterprise users through the integration of Azure Active Directory and Office 365, and by embedding Power BI, Power Apps and Flow as part of their applications, enables customers to have consistent identity, developer extensibility and security across their application portfolio spanning their own custom applications and SaaS applications. Microsoft has doubled down on their cloud investment and are going after Amazon and Google’s cloud services as the market continues to grow. While AWS still has a commanding percentage of the enterprise cloud market Azure has been rapidly chipping away at Amazon’s lead. Azure went from 34% to 45% of the market while AWS still grew from 57% to 64%. The data above comes from a survey by TechRepublic of 1000 technical professionals. Gaming The $100 billion plus gaming industry is experiencing massive growth and transformation, and we have an expansive opportunity as we think about gaming end-to-end — from the way games are created and distributed to how they are played and viewed. We will build on our strong foundation of connected gaming assets across PC, console, mobile and work to grow and engage the 53 million strong Xbox Live member network more deeply and frequently — from great game experiences to streaming to social to mixed reality. We will be the company for gamers to play the games they want, with the people they want, on the devices they want. I’m excited about our opportunity to accelerate our growth opportunity, innovate boldly and earn new fans. Microsoft has been on an acquisition spree in the gaming market. On June 10, Microsoft announced the acquisition of 4 game studios as they continue to innovate and grow their gaming business. Microsoft’s continued investment in Xbox, AI, and live streaming video games have the opportunity to be a large part of their Azure Cloud business.

Howard Schultz recently announced that he will be stepping down as executive chairman of Starbucks; exactly 26 years after their initial public offering. In 26 years as a public company, Howard helped transform Starbucks from a small coffee chain into a global brand with over 27,000 locations. In our newest investor letter, we can take a look at the 1992 Starbucks Shareholder Letter; their first as a publicly traded company. With no mentions of mobile ordering, international expansion, or Unicorn Frappuccinos it is remarkable to see the growth that Starbucks experienced with Howard Schultz at the helm. Expanding from 154 to 27,000+ locations two things have stayed true throughout; Starbuck’s commitment to their people and their coffee. All of the charts, images, quotes, and emphasis below were added by us. You can find the original 1992 Starbucks Shareholder Letter here. The 1992 Starbucks Shareholder Letter TO OUR SHAREHOLDERS: Every successful business has its competitive advantage. At Starbucks we have two: Our coffee and our people. Since our inception in 1971, Starbucks has been based on an unrelenting (some would say fanatical) devotion to providing its customers with the best possible cup of coffee. In Howard’s last shareholder letter (2016) this still rings true. Starbucks has continued to double down on enhancing the lives of their “partners” and the communities where they live and work. One indicator of this passionate commitment is the question we ask ourselves whenever we assess our efforts: are they as good as the coffee? Our retail stores are intended to be environments worthy of housing the finest coffees which nature and skilled human labor can provide. Dedication to quality, in the cup, is what Starbucks is all about. At the time of their IPO Starbucks was doing ~100,000 transactions at their retail stores a week. As of 2016? 85M+ transactions a week across their retail stores. In addition to their focus on people, Starbucks has scaled their transactions while staying true to their focus on quality coffee. Below is an excerpt from Howard’s letter to partners announcing his departure: “Sourcing and roasting the highest quality arabica coffee will always be our heritage. Never stop reaffirming Starbucks leadership position in all things coffee. I can think of no better expression of this than our Reserve stores.” A look inside the experimental Starbucks Reserve in Chicago. Many of the specifics that make our company seem unique to others are, to our way of thinking, simply natural, even inevitable, consequences of this core attitude and aspiration. Quality coffees are grown, roasted, brewed, by quality people, and the welfare of the people, the planet and product are inextricably linked. Our “employees” are called partners, and this is literally true, since every individual is offered stock options. We seek to seamlessly interweave variables that ensure quality for the customer with literal ownership in the company. We want to be the employer of choice in each market in which we do business. In order to achieve this goal we pay fairly, provide benefits to all whether part-time or full-time, and encourage individuality and open communication. Our environmental commitment begins with recycling and conserving wherever possible. We donate coffee locally in every market, providing homeless shelters and hospices better coffee for free than many of our competitors offer at full price. We are also entering our second year as the West Coast’s largest corporate donor to CARE, the international aid and development organization. Starbucks, together with its customers, funds CARE programs in the coffee producing countries of Indonesia, Kenya and Guatemala, with an emphasis on disease prevention and increased literacy for children. This year has been an exceptionally rewarding one. We achieved sales of $93,078,000 which were up 61.5% from 1991. We opened 53 new stores, including ones in our newest markets of San Diego, San Francisco and Denver. To no surprise, Starbucks has not been able to sustain their growth rate after raising $25M+ from their IPO but have continued to grow store locations at a steady rate. In 2017 more brick-and-mortar stores closed since the start of the “Great Recession” (2007), yet Starbucks added 2,250 net new store locations over the course of the year. The commitment to their people, coffee, and culture has continued to resonate with customers around the world. Also, we earned $4,104,000 after tax which represented a 70.4% increases versus a year ago. Lastly, Starbucks’ entrance into the world of publicly-owned companies this June was profoundly significant, both within the company and for the specialty coffee industry as a whole. It is an affirmation of our leadership position, but it is first and foremost a powerful demonstration of what can result from the joining together of great people and great coffee. Howard Schultz chairman, president, and chief executive officer

Just a few days away from the 16th anniversary of the Netflix IPO we decided to take a look at the initial investor letter and market sentiment from May 2002. Merely a DVD rental subscription at the time Reed Hastings briefly mentions online streaming and fails to mention creating original content. At the time a “niche business“, Netflix has transformed into a media giant and one of the more intriguing technology companies of our era. Fast forward to 2018 and the only way I know how to watch a DVD is in a friend’s 2003 Honda Odyssey. Or better yet, I can just pull up the Netflix app on my phone and start streaming Stranger Things, Narcos, or one of their other original productions. All of the charts, images, quotes, and emphasis below were added by us. You can find the original 2002 letter from Netflix CEO, Reed Hastings, using this link. The 2002 Netflix IPO Letter to Investors I’m pleased to report to you that 2002 was a truly remarkable year for Netflix. In this, our first year as a public company, we met or exceeded all of the financial and operational goals we had set for ourselves 12 months earlier. During a time of continuing uncertainty in the technology and financial markets, we were one of only eight technology companies to successfully complete an initial public offering in 2002. And in each of our three subsequent reporting periods as a public company, we outperformed investor expectations for key financial metrics, including revenues, expenses, EBITDA, and free cash flow. In this climate, the strength of our business model has been resoundingly validated by consumers who, in ever increasing numbers, have found significant enjoyment and value in our online movie rental service. In this letter, I will explain to you how this model works, why it is working so well, and why we believe it will ultimately change the way people experience and enjoy watching movies at home. First, I’d like to share with you a few highlights from our past year. THE PERFORMANCE OF THE YEAR. During 2002, we experienced the kind of rapid growth that many technology companies promised just a few short years ago but few delivered. In 2002, we doubled our revenue to $152.8 million, from $75.9 million in 2001. We ended the year with approximately 857,000 total subscribers (more than 1 million as of this writing), up 88 percent over the previous year. With positive free cash flow of $15.8 million for 2002 and $104 million of cash and short term investments, we have, and intend to maintain, an extremely strong balance sheet. Clearly, we are pleased with the results of the past 12 months. In addition to our strong financial performance, our accomplishments also included surpassing, in our first major metropolitan target market of San Francisco, our nationwide goal of 5 percent household penetration. Since 2002, Netflix has thwarted their expectations of 5% household penetration. As of January 2018, Netflix has made its way into 50%+ of U.S. households with broadband access. We remain opportunistic in looking for ways to improve our service and our operations. In 2002, we invested in 12 new distribution centers around the U.S., increasing the number of our subscribers who receive their DVDs with next-day service through the U.S. mail. Our marketing initiatives to acquire new subscribers through various channels including banner advertising, direct merchandising, and word-of-mouth remain highly successful. We will continue to evaluate the cost-effectiveness of new channels such as broadcast television as the number of DVD households continues to grow. Remarkably, Netflix still operates 17 distribution centers. A low from their 50+ they had in 2016. Netflix has continued to own marketing. Transitioning from banner ads and direct merchandising to impressive product (e.g. original content, personalized content, etc.), multi-channel, and email marketing. BUSINESS BASICS. Investors are right to ask why a company, regardless of how well it may be doing at present, believes its success will endure. At Netflix, we are encouraged by a number of market trends that indicate strong demand for our service in both the immediate and long-term future. For starters, consumers are becoming increasingly comfortable with the Internet. The widespread adoption of broadband technologies means a smoother web experience for more people across the U.S. In particular, people are coming to appreciate the more personalized recommendations that are enabled by software (compared to, for example, recommendations from video store clerks who may know nothing about their customers’ movie tastes) as well as the ease and security with which purchases may now be made online. Netflix has stayed true to this idea and continues to dominate competitors in algorithmic based content curation (more below). Second, as hardware improves and costs come down, the growth of DVD as the medium of choice for at-home movie entertainment is accelerating. We expect that household penetration of DVD, already the fastest-growing consumer electronics product in history, will climb from its approximately 40 million TV households currently to over 100 million in the next three years. As DVD ownership has become more mainstream, so has our subscriber base. In 1998 the demographic profile of our initial target subscriber was a classic early adopter: predominantly affluent, technologically-savvy, and male. Today, women make up more than half of our subscribers, while the household income of members joining today is roughly half that of subscribers who joined two years ago. MERCHANDISING MAGIC. The result of these trends is a market that we currently dominate with a highly visible brand presence. It is also a market that we believe will continue to mature, along with our Company. To ensure that we take advantage of this momentum, we are continually developing our understanding of how people browse and select movies. The key to our phenomenal consumer acceptance and business success is the sophisticated software that powers our website. Here, our subscribers are able to browse through 14,500 film titles—virtually every movie available on DVD, including both the latest and most popular TV series as well as hard-to-find documentaries—and place the ones they want to receive on a rental list that they continually replenish with new choices. In the past year we have significantly improved our ability to merchandise our titles to match the tastes of our subscribers. Beyond the richness of our inventory and the robustness of our distribution software lies what we believe is the true strength of the Netflix model: a proprietary system for personalizing movie recommendations for each subscriber via a remarkably powerful and innovative rating system. Instead of using someone else’s tastes to guide a subscriber’s choices, Netflix builds a profile of each person’s movie likes and dislikes to truly personalize a DVD recommendation. Evolution of the Netflix personalization approach “We want our recommendations to be accurate in that they are relevant to the tastes of our members, but they also need to be diverse so that we can address the spectrum of a member’s interests versus only focusing on one. We want to be able to highlight the depth in the catalog we have in those interests and also the breadth we have across other areas to help our members explore and even find new interests. We want our recommendations to be fresh and responsive to the actions a member takes, such as watching a show, adding to their list, or rating; but we also want some stability so that people are familiar with their homepage and can easily find videos they’ve been recommended in the recent past.” – From a 2015 Netflix Technology Blog Post The result is more often than not the movie-lover’s discovery of a personal “gem”: a movie that a subscriber has perhaps never even heard of and which may turn out to be a genuine favorite. This kind of match expands the audience for both acclaimed and lesser-known films—award winners that made their debut on DVD through Netflix and have gone on to find broad distribution, as well as smaller, low-profile movies from independent filmmakers and distributors. Subscribers rented fully 97 percent of the movie titles we carried in the fourth quarter of 2002. To help achieve such remarkably broad inventory utilization, we’ve added new areas on our website, such as the Critic’s Pick page and the Netflix Top 100 page, that make it easier for subscribers to discover interesting content. For customers who know what they want to watch, we’ve made the search function more intuitive, with better ranking of search results and more obvious results listings. And we’ve made it easier for subscribers to answer their questions and resolve problems online, which has reduced our service costs. LOOKING AHEAD. Our vision is to change the way people access and view the movies they love. To accomplish that, on a large scale, we have set a long-term goal to acquire 5 million subscribers in the U.S., or 5 percent of U.S. TV households over the next four to seven years. By then, we expect to generate $1 billion in revenue and $100 to $200 million in free cash flow. In the shorter term, a year from now, I expect to be able to report to you that we ended the year 2003 with 25 operational U.S. distribution hubs, initiated international expansion into Canada, and generated total revenue of more than $235 million. We are fortunate to have in place an extremely strong management team that has both the experience and the vision to propel the Company forward in what we believe will be a dynamic new market. As we continue to roll out and improve our service, we are optimistic that we have the potential for even greater gains ahead. The coming year promises to be an exciting one for Netflix, and we hope that you’ll be with us to enjoy the show. On behalf of the management team and dedicated staff at Netflix, I would like to thank you for your continued support over the past year, and I look forward to your continued participation as a member of the Netflix family. Sincerely, Reed Hastings – Chief Executive Officer, President, and Co-Founder

It’s no secret that startups are hard. Over the course of building a company it is inevitable that some quarters/months/years will not go as planned. The period of doubt that follows a down month can be a major setback for a startup. Paul Graham calls it “the trough of sorrow“. Ben Horowitz calls it “the struggle“. The good news; just about every founder has been in the same position and there are steps that can be taken to recover from a down period and carry on. Take a Step Back While it is easy to panic and make drastic changes after a down period it is vital that you take a step back and evaluate the issue. Jason Lemkin suggests starting by asking if it was a “hard miss” or a “soft miss”. A soft miss can still grow the business but you may have missed a stretch goal (e.g. Revenue grew by 25%, goal was 35%). A hard miss “is a sign something is amiss” (e.g. adding $500k in Q1 but only adding $200k in Q2). Lemkin suggests making small changes after a soft miss; rally the team, make small improvements, etc. Acknowledge you’ve missed your goal but ultimately you are still growing the business. When sharing the miss with your investors, be sure to be delicate when sharing the info. While it may have felt like a miss internally growing the business X% is still impressive. Get In Front of The Issue A “hard miss” sucks but it is not the end of the world. Get analytical, get into the weeds, identify the issue and come up with a plan to move forward. You have employees, customers, investors, etc. leaning on you so it is important to keep an even keel and create a plan everyone can rally behind to keep the company moving in the right direction. Most importantly, reach out for help if there are issues you can’t handle yourself. Don’t be afraid to share the details with your investors. The worst thing you can do is hide and fail to keep your key stakeholders in the mix. From your investors perspective, it is expected that you will have down periods and are there to help you through “the struggle”. Focus and Execute You’ve discovered the issue, you’ve got a game plan, everyone is aware and ready to move forward. Now what? The past quarter is in the books and it is time to focus on what lies ahead. As Ben Horowitz puts it you need to “focus on the road ahead“; “When they teach you how to drive a racecar, they tell you to focus on the road when you go around a turn. They tell you that because if you focus on the wall, then you will drive straight into the wall. If you focus on how you might fail, then you will fail. Even if you only have one bullet left in the gun and you have to hit the target, focus on the target. You might not hit it, but you definitely won’t hit if you focus on other things.” Stayed focused on bouncing back and make it a point for your key stakeholders. If revenue is down, chances are you are closer to your zero cash date and need to make sure this is accounted for. It is likely that you will need to re-forecast your cash and financial projections for the year as well. Share the new projections and make everyone aware of where the business stands after your miss. Over communicate if you have to. Make sure you do everything in your power to avoid back-to-back misses.

Business Storytelling Looking for a New Year’s Resolution? Keep reading! Storytelling in business has become a clear competitive advantage over the past decade. Customers, investors and talent have more choices than ever and are armed with more information than ever. Companies that can effectively tell their story will create emotional engagement with their stakeholders, cut through the noise and ultimately drive growth. In relation to fundraising, storytelling is a crucial component of driving interest and ultimately term sheets. This is especially true in the early stages as checks are written more on vision than traction. There are a lot of great resources for storytelling in relation to fundraising so check back for Part II next week for storytelling specifics. Today I wanted to focus on one often overlooked part of fundraising & storytelling and that is “connecting the dots”. Simply put, how do you create a cadence with potential investors and consistently drip information so that when you are fundraising trust is established and momentum can be created. As with my things in life, what you invest in is what you’ll get out. Fundraising is no different. Investing in stakeholder relationships early on and putting in the effort will pay dividends down the line. While fundraising is legally a “transaction” it is far from one to actually get there. (Sidenote: fundraising is a funny thing isn’t it? Investors tell you are fundraising 24/7/365 but they also tell you to tell investors you are not fundraising.) Seasoned investors won’t invest on their first interaction. They invest in lines & trends. They want as many data points as possible before make a decision. Afterall trends tell a story. Mark Suster penned this perfectly over 7 years ago in, “Invest in Lines, Not Dots”. “Most importantly tell them what you plan to achieve by the next time you see them. Hopefully by then you’ve made good progress. You’ll be able to give them an update on key hires, pilot customers, key tech innovations — whatever. Keep these interactions low-key and short. Quick coffees, whatever. Swing by their offices to make it easy for them to say yes and promise not to take up more than 30 minutes for the update (and stick to it).” Your interactions with stakeholders might look like this before you are officially fundraising: Each one of these dots represents an interaction and the chance to further tell your story. Over time you’ll build the trend and establish a rapport. You’ll be surprised how your entire fundraising process will change for the better. This doesn’t relate to just fundraising. It can be applied to key hires, potential acquirers and other key partners. Want to put your marketing hat on? Utilize Visible Updates + Lists to drip updates to potential investors in between your in-person interactions. Sign up here! Want to maximize your round competition and decrease decision marking time? Make sure to check out Part II. Up & To the right, Mike & The Visible Team

Digital Currency Group Monthly Update Template With the price of Bitcoin surging and digital currencies taking center stage on major news networks many companies in the space are having difficulties separating their growth with industry growth. Our friends at Digital Currency Group are one of leaders in the digital currency/blockchain space. Their portfolio of companies has accounted for an impressive 70% of industry funding to date. As the industry continues to grow the team at DCG put together an investor update template for their portfolio companies to use. With the appeal of blockchain/digital currencies at an all time high the template is aimed to allow founders to separate their success from that of the entire industry. At DCG, as investors and company builders, our skill is our ability to recognize patterns. Without clear data and insight, it’s very difficult for us to guide and support our companies. More importantly, the old adage, “top of mind, tip of tongue” certainly holds true. The more companies share with us, the more we are able to support them, and the more we can tell everyone in our network about the great things they’re building. – Meltem Demirors in “The Next Round: How to Build Growth Stories with Data” The DCG Template below is broken into 7 sections that give investors the information needed to help companies as much as possible. In addition to the 7 sections DCG offers 3 key points for sharing information with investors and stakeholders: Keep it simple and short – bullet points are easy to read Be extremely specific Include charts where you can Check out the DCG Template Here >>>

Techstars Investor Update Template In the “Minimum Viable Investor Update”, Jens Lapinski, Managing Director of Techstars METRO, lays out 3 items that he finds most useful in his portfolio company updates: Cash flow / P&L top line summary Major changes / developments Problems the CEO is struggling with and wants help on We created a Visible Update template based on the Techstars Investor Update so you can get necessary information to your investors in a quick and professionalize manor. Check Out the Template Here >>>

A Weekly Email Template for Marketing Leaders Marketing is one of the most measurable aspects of a business. With vast data points, it is important to hone in on what truly matters and rally your team behind those key metrics. This week, we have put together an Update template intended for marketers to “report up”. Whether that be a marketing representative to manager or manager to executive, our Marketing template is intended to be standardized across the team to keep everyone moving in the same direction. Key Metrics Keep in mind the metrics in the template are suggestions and can be tailored to your organization’s needs. Some of our favorite marketing metrics include Customer Lifetime Value, Customer Acquisition Cost (check out this video to use formulas to create CAC in Visible), and these 5 metrics for “reporting up”. TL;DR A quick recap of any major milestones, concerns, and figures from the last period. Always a good idea to piggyback off of any product updates, metrics, projects, concerns discussed at previous meetings/updates. Now Content and Campaigns Include a brief section of any campaigns, content, and emails published from the past week. The goal here is to keep everyone in the loop and ultimately lead to conversations and improvements. Funnel Review A funnel is a quick way for all parties to quickly digest your marketing conversions and inbound marketing efforts. The metrics used in a funnel can be customized to any business as well. Make note of any interesting leads or trends that have noticed over the previous period. Customer Stories Reflect on the past period and share any relevant quotes from customers; good and bad. What is going well? What is not working? Feedback to certain emails? etc.

While there are countless number of investor update templates the “Fill-In-The-Blank” template below from Micah Rosenbloom, Partner at Founder Collective, was right in line with the best practices we have seen. (You can find the original Founder Collective post using this link). We created a Visible Update template so you can fill-in-the-blanks and have your next investor Update out the door in just a few minutes. TL;DR A quick recap of any major milestones, concerns, and figures from the last period. Always a good idea to piggyback off of any product updates, metrics, projects, concerns discussed at previous meetings/updates. Key Metrics Take a deeper dive into your “Key Metrics” that you have defined and report to your investors. Make sure to keep they key metrics you are reporting consistent from update-to-update. Be sure to mention any changes to the key metrics you are reporting (how you are calculating, renaming, etc.). Fundraising If you are actively fundraising be sure to include any details, asks, and supporting documents here. Learnings Since Last Update Follow up to any of the major discussion points from your last update or meeting. How did marketing campaign X end up performing? What did you learn from any product updates? Etc. What I Feel Good About Include any major wins or significant gains in your key sales/marketing metrics. What I Am Freaked Out About What is keeping you up at night? Be sure to mention any major concerns that your business is facing. This could be anything from frustrations with hiring to a change in the market. What I Need Help With Arguably, this is the most important section of the Update as it allows your investors to step in and help with their experience, network, etc. At the end of the day, your investors are there to help you and are missing a valuable resource if you do not make the asks.

With Q3 wrapping up in a few days, we put together a Pre-Board Meeting Update Template that you can share with your board to help you make the most of your meeting time. By sending over a quick packet before your next meeting it will allow everyone to have time to prepare and come ready to discuss the topics that truly matter to the business. VIEW THE TEMPLATE HERE >>> For the sake of simplicity, we broke our Update Template into 5 major sections: Overview of Previous Quarter A quick overview of the previous quarter. How did you track against your goals you set at your last meeting? Big Wins? Concerns going into Q3? Key Metrics A high level overview of the key metrics you have been sharing with your investors/board. Make sure to include any key events/descriptions for your data over the past period and leave time to discuss any questions at the start of your meeting. Agenda Preview the agenda and schedule for your upcoming meeting. Use input from previous meetings and 1-on-1s to set the agenda and make sure the time will be useful for everyone involved. We suggest checking out Sequoia’s template for a board meeting to get started. Topics of Discussion Offer an overview of the major issues you would like to tackle during your meeting; “working time”. Without throwing too much information at your investors give them the proper data, questions, asks, etc. that will allow them to ponder the issue beforehand and come to the meeting ready. Meeting & Financial Documents Include any necessary financial and meeting documents prior to the meeting. Always a good idea to include financial statements and documents/presentations for your meeting. VIEW THE TEMPLATE HERE >>>

As Q3 comes to an end, it is easy to get behind trying to close last seconds deals, make the right hires, or push product updates but it is vital to stay organized for your Q3 board meeting. A board meeting is not something founders and CEOs should lose sleep over. If executed and prepared for properly board meetings can become an integral part of your company’s success. However, it is easy to lose focus and can easily turn into hours of tracking down data, reading bullet points off a slide, and losing grip of the conversation. To help lighten the load of board meeting prep we’ve put together a short guide to help have your ducks in a row before your meeting: Pre Board Meeting Reporting Being the CEO presenting at a board meeting it can feel like all eyes and pressure are on you. With sending over a structured report before the meeting you can turn the tables and put the pressure on the board to come to the meeting prepared. You never want to spring any surprises during a board meeting, by sending out the packet ahead of time you’ll avoid said surprises and set the expectation that everyone should come prepared. This will also give everyone a chance to read through the packet, request any changes and avoid tedious discussions during the meeting. “Sometimes, if someone asked about something and clearly hadn’t done their homework, I’d say, ‘Oh yeah, that’s in the board pack.’ That’s the most damning thing that can happen to a board member — realizing that all of their peers prepared for the meeting and they didn’t.” – Jeff Bonforte (Former CEO of Xobni) With that being said, it is important that you supply the board with the correct information in a timely manner. Most founders/CEO have found it best to send over their pre-meeting report/packet at least 4 days in advance. Make the report comprehensive and relevant. This can include financials, wins, losses, near term concerns, plus goals for the next quarter. Putting together a pre-meeting report can be a long process (and probably should be) as you reflect on the past quarter and lay out your vision for the next quarter. Putting the time in will be worth it as it will save precious time and allow you to discuss what truly matters. Be on the lookout for a pre-board meeting Visible Update template early next week! Set an Agenda Lets face it, getting a group of people in a room to stay focused is next to impossible. To make the most of your time, lay out an agenda and stick to it! We have found that most board meetings should last anywhere from 2-4 hours. Below you will find an example agenda from the team at Sequoia Capital: Read Sequoia’s guide for preparing a board deck/agenda here. Ideally, if you sent over your metrics and data beforehand you should be able to shorten the time needed to discuss specific metrics. This will allow to focus on what truly matters over the next quarter; fundraising, hiring, product improvements, etc. Not a bad idea to include your agenda when sending over your board report/packet as well as your board deck. Related Resource: Crafting the Perfect SaaS Board Deck: Templates, Guidelines, and Best Practices 1-on-1 Meetings If you are able to carve out time with each of your board members beforehand to discuss any topics one on one – do it! No need for a lengthy discussion but board members will appreciate being kept in the loop and offering input in setting the agenda. If you have any previous asks left hanging now would be a good time to address those. Additionally, this gives you an opportunity to feel out how certain members feel about different topics and votes so you can be prepared to answer any questions and avoid surprises. Provide Solutions Take a look back at the previous quarter and ponder your wins, losses, product updates, etc. and have answers ready to any questions you might face. Instead of an in-depth product review it might be most efficient to focus on any of the improvements you made over the last quarter and why you made them. This way you can avoid countless product requests being thrown around from people who are likely not even using your product. If your sales were down in July, why was that? If your churn was high in August, why was that? While it’s never fun to look back at losses from the quarter it will make your life much easier to have an answer and solution moving forward.

Last week, we broke down the most popular days to send your investor updates. Check out the charts and data below for a quick refresher: The least popular date is the 30th of the month. When the page turns on the past month and updates/reports start flooding VC inboxes how do they view you? The Clockwork CEO The favorite CEO among investors (when it comes to monthly Updates ;). The “Clockwork CEO” has the same time on the same day set aside every month to sit down and crank out their stakeholder updates. The Clockwork CEO has likely created a rhythmic cadence with their investors and give them a “story” to look forward to on a monthly basis. The Weekend Warrior CEO The rare breed of CEO personas (We’re looking at you R.J. Taylor) the Weekend Warrior is one and the same as the Clockwork CEO. Setting aside their Saturday or Sunday morning to sit down and reflect on the past month likely before heading out with the family for the weekend. The Good Times CEO The “Good Times CEO” leaves investors feeling great about the company… until the next month when they receive no updates or news from the founders. After a big win or great product improvement the Good Times CEO Update will land in their investors inbox the next morning. Don’t get us wrong – we like to let the good times roll just as much as The Cars but investor’s offer their most value when you are struggling and have specific asks/issues from the previous period. The Non-Comparable CEO The “Non-Comparable CEO” sends over structured Updates on a regular basis but still leaves a big question mark in the mind of their investors. Switching, changing, and manipulating metrics on a monthly basis leaves everyone involved scratching their head as the next set of data comes rolling in. So how do you avoid misleading numbers? The Buzzer Beater CEO The “Buzzer Beater CEO” leaves their investors on the edge of their seats and always get their Updates across; even if it is the last second. As end of month tasks pile up, the dreaded investor update takes a back seat and is often missing major details and leaves dots for the investor to connect. The Missing in Action CEO The “MIA CEO” is the one that keeps their investors up at night. After the initial enthusiasm that comes with new investors, you find yourself in the “trough of sorrow” and have yet to send an Update after that first polished and optimistic Update. Believe it or not, most investors have made it through the “struggle” and are an integral piece in helping your company bounce back to that initial enthusiasm.

When should I send my investor updates? We often get asked questions from customers and prospects ranging from: When should I send my investor update? How long should my investor update be? What should I include in my investor update? While there is no hard and fast rule there are some best practices. (Our first piece of advice is don’t overthink it and just send it! Check out our Techstars presentation for more best practices on Investing in Investor Updates) We have a meaningful dataset at our fingers tip so we brushed up on our SQL query skills to break out some insights with how our customers are using Investor Updates. On average, Visible users are sending investor updates out to ~12 recipients and including ~4.5 charts. Fun fact: The most recipients for a given update is 130 and most charts coming in at 40 (alert: information overload). Here is a breakdown of investor recipients. This is a count for the past quarter and is truncated to show 5 to 20 recipients. Finally, we wanted to see the most popular day of the week investor updates are sent. Unsurprisingly, Monday is the most popular day of the week followed up by Tuesday and Friday. The least popular day of the work week is Thursday with Saturday being the least popular across all days. I also took a look to see the date of the month that are most popular for sending updates. The Top 3 are: 3rd – 5.32% 20th – 5.02% 10th – 4.28% The least popular date is the 30th of the month. Want to learn more? Check out our guide, “How To Write the Perfect Investor Update (Tips and Templates).” Stay tuned for a follow up post with the best days to increase engagement around your investor updates!

This is an updated post from our original “What is Your Investor Net Promoter Score?” from May 2015. It is not a secret that we love Net Promoter Score at Visible. The term “Net Promoter Score” has a corporate ring to it, making it seem like something that startups don’t need to worry about until they “grow up”. In reality, implementing a customer happiness metric like NPS is one of the most important (and easiest) things your startup can do once you begin to acquire customers. An accurate NPS helps you gain an understanding of how loyal your customers will be over the long term and what kind of word of mouth growth you can expect. But it isn’t just the happiness of your customers you should be worried about. Investor Net Promoter Score for Startups As a founder and executive team, part of the job description is keeping all of your key stakeholders engaged in the business and customers are just one of the groups you need to be attentive to. Your investors are another, which is why your Investor Net Promoter Score – the percentage of your investors who would recommend you to potential customers, key hires, distribution partners or follow on investors minus the percentage who wouldn’t – is also key to the long term success of your fledgling business. In theory, your Investor Net Promoter Score should be 100. Why wouldn’t an investor recommend your product or your company culture to someone from the outside? If you close an important sale, bring on a talented engineer or find a new market for your product, your investor’s stake is worth more money, right? In the real world, it isn’t that cut and dry. Investors, like startups, have resource constraints. More importantly, they have a reputation to protect. And while they want all of their companies to find success, their motivations change over time based on how engaged they remain in each of their portfolio companies. The question is, if your Investor NPS is not 100 how do you get there? How to Improve Your Investor NPS 1. Invest in investor updates. Build a regular cadence with your stakeholders. Build a cadence and keep updates succinct as well as comparable. Consistent communication builds trust and keeps you on top of mind for your investors. Make sure to keep your metrics and format comparable from update to update. Ask for tips and preferences to tailor your updates to a format that is best for both you and your investors. Take a walk in your investor’s shoes. When an investor comes across a great designer looking to join a startup, who do you think she will recommend? The company she hasn’t heard from since wiring the money, or the one that comes to her each month with a quick overview on how things are going and how she can help? “The CEO is the investor’s user interface into the business” – Dharmesh Shah 2. Create a culture of candor. While driving an internal culture of candor results in better decisions, execution and output, the same can be said when communicating with your external stakeholders. Don’t be afraid to share bad news. You are not alone, even though it might feel like it. Be frank about the state of the business and make the appropriate asks. At the end of the day, your investors have been in the same situation and are there to help you through “the struggle” or better yet, help you get to the next stage in your business. “Investors can only help if you are transparent all the time, not just in good times.” – First Round Capital 3. Respect their time As touched on before, investors are busy people. Whether they are investing on behalf of a fund or as an individual angel, it is likely that they have other portfolio companies and business ventures that they are dealing with on a daily basis. Your goal should be to give your investors the ability to make the largest impact on your business with the least amount of exertion. When you are seeking advice or introductions, be specific. By doing this, you increase the probability that your investor will take you up on your request, helping to increase their engagement in your business and start a virtuous cycle of “Investor Success”.