Insights to investor relations - why is investor communication important?

"How often should I communicate with my investors?" Is a question every company with a fragmented investor base should think about. Have you done a crowdfunding round on a platform or privately, this should be high on your agenda. Having good investor relations relies a lot on the communication towards your investors, but nailing down the perfect amount of communication is challenging. Privanet performed an investor relations research in February 2019 in their investor community, and we got the chance to share some of the results with you. The research aimed to map how much communication investors receive from their invested companies after and between the crowdfunding rounds, how much communication investors want and what they think about contributing to the company success.

HOW OFTEN SHOULD I COMMUNICATE WITH MY INVESTORS?

Investor communication is crucial and the best way to instigate engagement. According to the research, engaged investors were willing to help the company if needed and engaged investors received more regular communication from their invested companies compared to the investors who were not willing to help the invested company. The data suggested that in order to get your investors engaged, you should regularly communicate with them.

The biggest insight and maybe the most important one for the crowdfunded companies is that almost 80% of the respondents would want more communication from their invested companies. 70% of investors would want to receive communication at least once a month, supporting the suggestion that regular communication is crucial for the investors. Only 17% of the investors got the amount of communication they wanted at the moment, showcasing the communication gap between companies and their investors.

Value of frequent and transparent communication should not be overlooked, since 94% of the investors stated that transparent communication is an important criteria for their investment decision. This suggests strongly that in order to engage your investors to the level where they are ready to invest again when needed, you need to focus on your investor relations communication.
Investor relations research.

ENGAGED INVESTORS ARE READY TO HELP THE COMPANY WHEN NEEDED

The most interesting results might be the fact that 51% of the investors were ready to help their company when needed and invest up to half an hour per week to help their company. This resource of engaged investors with diverse backgrounds is powerful and can lead the company to their success. 59% of the respondents (who were ready to help their invested company) stated that they would be able to help the company more than 15 minutes per week and 75% of them stated that they would give their opinion on an issue the company presented. To be able to tap into the knowledge pool that your investors have is really a game changer especially for the crowdfunded companies.

Organizing investor relations is challenging especially when the number of investors increases. The most popular channel for investor communication according to the study was email, which might work well in one way communication, but lacks the ability to build engaged investor communities. Engaged investor communities offer strength to the company, which cannot be found anywhere else. In order to turn your individual investors into a community, you need two way communication and discussions. Being able to have discussions with your investors in a secure space, where more passive investors can follow the conversation and gain the same insights as the active followers, is key to investor engagement.
FOCUS INVESTOR RELATIONS MANAGEMENT IN ONE PLATFORM
CrowdWorks offers an investor relations platform for companies with several investors, where they can build engagement on top of their capitalisation table. By focusing communication to one channel and enabling investors to also give back, instead of just being passive receivers, building engagement will be easier. With CrowdWorks the companies are able to communicate in a two way manner with their investor base, ask and get help, share insights and news, showcase their current KPIs and tell their story, all in one place.

Written by Reetta Pellikka
Digital Marketer of CrowdWorks
Sign up for a demo
Make your investors your best ambassadors and enjoy the power of their extensive
network and competence.
© 2019 - All rights reserved
Contact