This keynote from an Angel Capital Association regional meeting describes three successful exits that were also what I call "Accidental Exits." By that I mean exits that were the result of an unplanned approach from a buyer. In this very active M&A market, sellers are often being surprised by buyers changing the conversation and offering to buy the company.
When I was CEO of my first technology company I thought I understood how patents worked. But it was only after managing a hedge fund for a few years that I began to appreciate the risks patent holders face.
Many entrepreneurs think that the real test of a patent’s value is whether or not it will be granted. But in my experience the real value isn’t known until you’ve spent years, and millions of dollar...
Recently, at an Exit Strategies Workshop in Victoria, someone asked me to compare the pros and cons of an early exit versus a traditional Venture Capital financing.
The scenario we used for our example was a successful startup company with a proven business that needed $10 million to $20 million to fund growth.
(In this article, I am being precise about the distinction between the business a...
In earlier days, entrepreneurs dreamed of founding an innovative start-up and building it into a big company. After many years of solid sales and profits, the company might be acquired, with founders and investors earning a capital gain.
But in today's fast-evolving technology marketplace, growing a small start-up into a big company may not be the best strategy. An increasing number of promising start-ups are exiting early at very attractive valuat...
It's rare to be able to post a detailed case study on an early exit. The most interesting information is usually restricted by a non-disclosure agreement. This is a very valuable opportunity to hear directly from the Chairman and a lead investor about what went on behind the scenes in this $30 million pre-revenue exit.
These videos complement the complete written Read More
In my early-stage venture capital fund, The BC Tech Fund, I invested in nine companies. About three years after the first investment, three of the nine had achieved early exits - one went public and two were acquired.
• Brightside was acquired in February 2007
• Parasun was acquired in May 2007
• Metrobridge went public in July 2007
These are much fa...
When I first blogged about early exits in BC all of the comments were negative.
This wasn't surprising. A lot has been written about the negatives of startups being 'built to flip". The term has a negative connotation - as if something improper is being done.
The most popular article on this topic, titled "Built to Flip" was written by Jim Collins and published in Fast Company...
Companies everywhere are being sold earlier and earlier. These days, acquisitions often happen before companies are two or three years old. Recent UBC research discovered that in British Columbia and Alberta, we are better at early exits than anywhere else in Canada or the US.
In my early-stage venture capital fund, The BC Tech Fund, I invested in nine companies. Three years after the first investment, three of the nine had a liquidity event - one ...
Whenever I hear an entrepreneur, or angel investor, say “early exit” they have a really big smile on their face. Even some of my VC friends beam when they talk about the jump in their returns if they've gotten lucky with an early exit.
In my experience, almost everyone wins in an early exit – the entrepreneurs, the employee share and option holders and the angel investors certainly do. I do acknowledge there are times when early exits are not...
Companies are being acquired at earlier and earlier stages – often just 2 or 3 years from startup. Why is this happening now? A large part of the answer is that this is another natural consequence of the internet - part of the development of our economy and the evolution of our species.
There are some excellent early exit stories in BC. Early exits helped make my Read More
We are better at early exits in BC and Alberta than in any other province in Canada or state in the US.
This conclusion came from an excellent research study led by Thomas Hellmann at the UBC Sauder School of Business. This was a significant research project conducted to the highest academic standards. Thomas and his colleagues analyzed 509 exits of Canadian venture capital backed companies that generated a total exit value of $30 billion and compa...