How should I manage my shareholders?


Just raised money via crowdfunding? Have you raised money traditionally several times and have lots of shareholders to manage? So, what is the best way to manage all your shareholders?

Managing one’s shareholders via equity crowdfunding is something that gets raised a lot. It is a hot topic because now companies are finding they have shareholder bases of well over 50 shareholders and find this burdensome. This can also be the case if you have raised money outside of crowdfunding also. Are your shareholders a burden? If you answered yes, then there is a problem. Shareholders are and should be your biggest advocates. They believe so much in what you are doing they invested their money in your business. There are fewer bigger advocates then those willing to stick their necks out with the founders and help your business grow. See Oscar Jofre’s article on making shareholders your business champions….

The quickest way to turn a shareholder into a burden is by avoiding them. Keeping them in the dark, failing to communicate, and waiting for them to harass you for an update turns them from champion to burden. Remember that the customer that has a bad experience is 10 times more vocal than the happy customer, well the same applies to shareholders. We believe that frequent updates and transparency on how your business is doing is the best approach to keep the engine running smoothly and the engage your shareholders.

But my business isn’t going as well as I had planned and I’m afraid to tell my shareholders. If this is your concern, it is a common one. However, by not telling them you are failing to give them a chance to help you. Your shareholders bought into your business because they like it. Some of them may have run businesses themselves and may have valuable input or advice for you. Proper engagement will bring you advice and the possibility of more financing if the well has run dry. In my experiences, shareholders can be understanding and helpful even if you give them the opportunity.

To manage the shareholders in an optimal manner requires firstly that the entrepreneur knows his investors. Knowing the investors or shareholders goes far beyond just sending them updates or asking for more money. It involves building a professional relationship where the worries and struggles of the company are shared by all and not by one.

The entrepreneur also needs to regularly e-mail about the progress of the company so that trust, transparency and openness within the boundaries of the company are norms that are expected of everyone. Having a proactive attitude and taking the initiative to sharing new updates regarding internal accounting and auditing, financial information, product and manufacturing, research and development, marketing strategies and sales forecasts should happen regularly.

The entrepreneur should also reach out to collect shareholder feedback via polls and personal communication in a way that makes shareholders feel as though their views are really being taken into consideration. Obtaining feedback and keeping abreast of shareholders in a personal way can significantly affect their willingness to support you when the going gets tough, and makes for a better experience for everyone!

Hopefully you now agree that keeping your shareholders engaged is important. Now, what is the best way of doing that? There are many tools to help and I bet many people started with an excel list and outlook, maybe even progressing to mailchimp or some other mail program. While this is a common approach it is rot with inefficiencies and risk. What if a shareholder moves or changes their contact details? Did you know email is NOT secure and that once you send it from your server it becomes in the public domain? Are you comfortable with your private information being publicly available? How are you tracking their engagement?

There is one tool that can help you do all of this and much more. At KoreConX all-in-one free platform have been building tools to help small and medium sized businesses operate more efficiently and save money in the process. For instance, did you know that our free version allows you to: Manage your boardroom activities, manage your Cap Table, manage your due diligence processes using our deal room, provide portfolio management to your shareholders, and much much more. Check out to learn more.

By providing portfolio management to your shareholders for free in KoreConX you are allowing them to stay connected with you at all times within a secure environment. When they move or change any of their contact details in the system that information automatically updates your records so you are always up to date. Our Investor Relations module allows you to communicate and engage directly through the platform and track the results. It offers a variety of other features to manage meetings, perform and tally evotes for shareholder meetings, perform outreach to potential investors, etc. This is the true way of optimizing your shareholder value.

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