Lisa Hjorten

"What we've got here is failure to communicate." That classic line from Cool Hand Luke also could summarize the interactions of entrepreneurs and investors who don't always see eye to eye. Lisa Hjorten has experienced those problems both as a technology executive and as an angel investor, one of the reasons why she started Informia.

Today, the Kirkland company is announcing a new product called InvestorUpdate that helps startup entrepreneurs create a consistent dialogue with the people who are bankrolling them. Hjorten came up with the idea about a year ago after participating in real estate partnerships and angel investments.  "I was motivated to start it out of anger and frustration and knowing that there had to be a better way," she said.

In her experience, Hjorten said she would invest money and then never hear from the company again.

"It just infuriated me.  I would call the CEOs and they would say they were going to put out an investor update and then it never happened," she said.  "And, if it did, it was just a bunch of glowing comments about how great everything was.  Until, the email came saying they were out of money and wanted to get more from me."

Hjorten recognized there may be a business in setting up a structured template, which forced the entrepreneur to send out regular reports. So, the former CEO at Pacific Edge Software started asking around and found out that other investors had encountered the problem too.

In her view, entrepreneurs avoid sending out status reports for three reasons: They want to report good news; They want to avoid bad news and it is just too hard. InvestorUpdate, she said, tries to resolve those three problems through education and a structured publishing system.

The hosted software, which costs between $900 and $8,000 a year depending upon the size of the organization, sets up what Hjorten is calling "Collaborative Status Reporting." That's essential an online editing tool, which allows various people inside and outside the organization to add information.

"Typically the CEO gets tired of bird-dogging the process through emails and phone calls and tries to write it himself or gives up completely," she said.  "We manage the process through reminders, prompts, editing services, templates, etc."

In addition to InvestorUpdate, the company is working on a product called DonorUpdate that allows executive directors at non-profits to send out reports to their donor base. They are also working on BankerUpdate, OrgUpdate and other variations of the concept.