How to Communicate in a Crisis with Investors
In uncertain times, it is imperative to be in communication with your investors. Coronavirus may bring with it a higher sense of urgency and fear, but we can look to recessions of the past for guidance through the chaos. While you may be maintaining great communication with your investors throughout the year, a crisis calls for extra care and attention to ensure your investors’ confidence.
Come Out on the Front End
Don’t wait for your investors to chase you down in a crisis, come out on the front end and call them as soon as possible. We have a tendency to run away when we’re feeling barraged, but the stress and the fallout is greatly minimized when we just confront the problem head on. Even if you have bad news to share, your investors are happy to hear from you. They need to know that you are keeping them in mind in the midst of a crisis and they aren’t forgotten or deprioritized in the chaos of what may be happening with your business.
Be Transparent Always
The best way to give bad news is to be transparent and honest with the recipient. Do not try to lie or sugar coat the situation, just come out with what you need to say in a calm and confident way. Let your investors know what you are doing to handle the crisis. In situations like Coronavirus, it may seem like there are no good decisions, but communicating honestly and regularly with your investors will help ease their fears, even if they may not like the news.
Proactive communication on your part will also increase the likelihood of them choosing to invest with you and your future deals. They will remember how you handled this crisis, if you made them feel valued and prioritized, and they will share that with others as well. They will also share how you handled it poorly, if you do.
Be Available
This is crucial; you always want to answer their calls! When its touch and go, you need to make sure you are available when an investor needs to talk. They need to know they can reach you. If you ever miss a call, text, or email, make sure that you are responding as soon as possible, even if you don’t have an answer. Reply quickly, and let them know when you will be able to follow up, if needed.
Get Personal and Touch Base
There’s a lot of ways you can stay in touch throughout a crisis, you need to figure out what works best for you, your business, and your investors. You might choose to put out a weekly or as needed email. At Stone Bay, phone is our preferred method of communication, as it carries a more personal touch. We called almost every single one of our 170 investors during the first few weeks of the coronavirus outbreak, so we could see how everyone was doing, tell them our plans, and answer any questions they had. That kind of in depth interaction is missing when you just send out an email. This doesn’t work for all business owners in all situations, but keep in mind that sometimes, the best thing to do is just pick up the phone.
When talking to your investors, try not to just update them on the status of your business and their money, ask them how they are doing in the midst of this. You never know how you may be able to help someone out, or how they may be able to help you, and during a massive crisis, its personal connections with the people around us, and everyone supporting each other, that pull us through. We have a family culture at Stone Bay, and it is especially important to us that we get personal and make sure that everyone we work with is ok right now. It’s the personal touches and genuinely caring about the people you do business with that keep them apart of your company.
Think About Where You Want to Be When You Come Out of This
Do not just focus on where you are right in this moment, think about where you want to be when this storm has passed. When a crisis first hits, it may take a moment to get your bearings, but when you do, its time to look down the road and really think about where you are going and how you are going to get there. Taking the time to assess, adapt, and plan, will put you ahead of the game. Make sure your investors know that you are thinking about the aftermath and that you have a plan.
Show Appreciation
During or after a crisis strikes, think about sending a genuine, handwritten note card, or a personal phone call to show your appreciation. You want to express your gratitude for their trust in you, and sticking by you. The sentiment is what matters the most.
Communication and appreciation is the foundation of building and cultivating a successful relationship with your investors. How you treat them in a crisis will be remembered longer than how they were treated when times were great. Be proactive, be honest, and stay the course.
Steve Lloyd and Kerry Faix, Founders of Stone Bay Holdings.
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