Early Exits Overview
Presented at the ACA New England Angel Education Series – Boston, MA December 6, 2010.
To host an Early Exits Workshop for your group, please contact Chris Major at the Angel Capital Education Foundation.
- Much of what you hear about exits is wrong – dangerously wrong. There are so many myths and misperceptions.
- And quite a few dirty secrets. This workshop is about what works today when you want to sell a business.
- Angel investing is still quite new – about where traditional Venture Capital was in the early 1980s.
- The economy has changed – a lot. That is part of the reason that traditional Venture Capital doesn’t work anymore.
- When does it actually make sense for a company to take an investment from a traditional venture capital fund?
- Why exits today are under $20 million and why Google wants even earlier exits.
- Big companies aren’t the only buyers – there are several different types of buyers active in the market today.
- Startup economics have changed. It’s now possible to build valuable companies for only $100,000s, or even $10,000s.
- The internet has accelerated everything – many big exits have occurred just two or three years from startup. Here’s a list.
- How early can you sell a business? Selling in 2 or 3 years is often the optimum time to sell a company.
- The exit is just another business process – just like a product development or financing.
- Every company needs a clear, written, signed exit strategy. It doesn’t have to be complicated.
- Often the biggest question is not “How much can sell for?” it’s “How long will it take to sell?”
- Companies should be ‘sold’ not ‘bought.’
- Negotiating and closing the sale – even after you have a signed agreement, it can take 1 to 3 months to close.
- The ideal exit team – the CEO, the M&A advisor, accountants, lawyers and possibly an exit coach.
- Selecting the M&A advisor and M&A advisor’s fees.
- Building shareholder value and maximizing the selling price.
- This is a ‘golden era’ for technology entrepreneurs and angel investors.
- The ‘new’ angel model and resources on exits.
You can also watch this video series on YouTube, starting with Part 1 here.
Many of these lessons are described in my new book on selling businesses for entrepreneurs and angel investors – www.Early-Exits.com.