Investors are busy and don’t have time to be trying to figure out what lots of corporate speak and technical jargon means. Its taxing on the brain (called cognitive fatigue) and leads to frustration, confusion, and most importantly, investors loosing interest.
This is where the principles of plain language come into play.
Plain language means keeping your writing clear and and easy to understand.
It means removing text that distracts the reader from your message.
For example, take a look at the following sentence:
“The report to upper management delineated that the issues of the day were threefold. These included observations about the influx of low level prospects, a lack of effective conversions, and an inability to attract return patronage”
This sentence is difficult to understand and therefore a distraction.
The plain language version might look like this:
“The report focused on three issues: a lack of high paying clients, conversions, and return customers.”
Short, simple, effective. Exactly what investors need.
See here is the thing, when it comes to the investors decision making process, investors will only buy your stock after they have developed a narrative in their mind that includes the successful outcome of the investment.
They need to picture in their mind exactly why this stock is going to make them money so the easier you make it for investors to develop this narrative by being easy to understand and telling a more compelling story, the more investors will be buying your stock and thats what you want right?
Here are 6 simple ways to use plain language to attract investors, by improving clarity and understanding:
Remember Your Audience. Does every investor know as much as you do about your area of expertise? Probably not, so remember to keep things simple. With this in mind, you should: Drop the jargon. Remove phrases like “burn rate”, “touch base”, and “paradigm shifters” Replace inflated language with simple words. For example “transpired” means “happened”, “paradigm” means “ideal”, and “conundrum” is just a fancy word for “problem”
Organization. Your message should always be presented in a sequential, logical, step-by-step manner to make it is easy to follow.
Use Active Voice. Make it clear who is doing what. Sentences should be “we will do this to achieve X” rather than “the company will achieve X by doing
Use Clean Design. The presentation of your message is just as important as the words you use. Effective use of whitespace, headlines, subheadings, color, font, images – are all elements that can either support your message, or distract from it.
Minimize Long Blocks of Text. Help your reader digest the information you are presenting in small chunks whenever possible. Break long paragraphs into shorter ones with subheadings, and make sentences no longer than 20 words.
Use Tables, Charts, and Examples. For information that is complex or data that needs to be analyzed, remember to include helpful visual aids or examples.
Plain language attracts more investors so keep these simple tips in mind and your message and presentation will become more clear and compelling.
The result? More shareholders, increasing liquidity and valuation, and more access to capital.
Just because you think your story is simple and easy to understand doesn’t make it so. Always be sure and test.