The founders who send good investor updates every month tend to be the ones who know their numbers. That was the observation of Aaron Harris, then a partner at Y Combinator, in a widely shared essay on investor updates: YC saw a correlation between the quality and frequency of updates and the quality of the company. He was careful to say he doubted the update caused the success. But writing one forces you to look at the right things every month, and it keeps your investors close enough to help.
What YC partners advise
Harris's advice, summarised from his essay on investor updates:
- Decide what you report each month and keep it consistent: your growth (in revenue or users), your cash and burn, what you need from investors, and a qualitative sense of how things are going.
- Send it monthly. He calls it a forcing function, like writing your growth on a whiteboard for everyone to see.
- Lead with the key metrics and growth rates, then the asks. Put the asks high enough that investors see them.
- Make it shorter. You want them to read all of it and remember how they can help.
- Use charts where they show progress better than words.
- Do not drop metrics because you missed them. Adding a metric because it matters is fine; removing one because it looks bad is not.
The format often called the YC investor update template (Visible hosts a well-known copy and attributes it to Harris) follows the same order: key metrics, highlights, lowlights, asks, and sometimes a short team update.
What to include, in order
1. A one-line summary
How the month went, in one sentence with a number. "Best month yet: MRR up 14% to $48K, runway now 18 months." Some investors read only this line.
2. Key metrics
Four to six numbers, the same ones every month, each with the change since last month. For most early companies:
| Metric | Why investors want it |
|---|---|
| Revenue (MRR or ARR) or active users | The main measure of traction |
| Growth rate, month over month | The trend matters more than the level |
| Net burn | How fast cash goes |
| Cash in bank | What is left |
| Runway in months | When you need to raise or be profitable |
Define each metric once and keep the definition. If you report a proxy such as GMV, Harris notes, also report what you actually earn from it, or investors will wonder why you did not.
3. Asks
Two or three, each specific enough that an investor can act on it in one email. "Intros to heads of operations at dental groups with 20 to 200 clinics" works. "Customer intros" does not. A named role with a link to the job description works. "We are hiring" does not. Many founders put the asks right after the metrics so they are never missed.
4. Highlights
Three to five wins since last month: a customer signed, a launch, a hire, a milestone. One line each, with a number where possible.
5. Lowlights
Two or three things that went wrong: a lost deal, a missed date, a key person leaving, a metric that fell. This section is where trust is built. Investors have seen hundreds of companies; they know every month has lowlights. An update without any reads as an update that is hiding something.
6. Last month's goals and next month's
Score last month's goals honestly (hit, missed, partly) and set three for next month. Over a year this becomes a record of how well you predict your own business, which is something investors weigh when you raise again.
Cadence
Monthly at pre-seed and seed is the common advice, and it is the cadence Harris recommends. Pick a day, such as the fifth business day of the month once the books are closed, and keep it. Regularity matters more than polish: a plain email on time beats a designed newsletter that arrives whenever. After a Series A, when a board meets quarterly and gets a full pre-read, many founders keep a shorter monthly note for the wider investor list. For the board itself, see how to write a board pre-read.
How to share bad news
- Say it early, in the update, not in a call three months later. Investors are rarely angry about bad news. They are angry about surprises.
- Use the same format. The metric that fell stays in the table. The lowlight goes under lowlights.
- Say what you are doing about it. One line on the cause and one on the change.
- Turn it into an ask if it fits. A missed hire becomes a request for candidates. A churn problem becomes a request for anyone who has fixed one.
- If runway is short, say the number. "We have five months of cash and are raising now" lets investors help while there is still time.
Common mistakes
- Changing the metrics every month, so nobody can compare.
- Percentages without the base ("up 200%" from three customers to nine).
- Vague asks, or none.
- Only good news.
- Skipping months, then sending a long catch-up when you start fundraising.
Format: email, document or page
Harris's view was that the format matters less than the habit: a plain-text email is fine. What does matter is that you can produce it in under an hour from numbers you already track, and that last month's goals are easy to find when you write this month's. The update is for people already on board; for an investor who has never heard of you, send a business one-pager instead.
If you keep company notes in Obsidian, the update can be one note a month. The investor update template lays out the numbers as stat tiles, highlights and lowlights as cards, the asks as a numbered list and last month's goals scored. With myone.page you send it to investors as a link they open in a browser without Obsidian; an AI chat can draft it from your raw notes first (see writing a one-pager with AI).