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Exit Strategies for Angel Investors

by Basil Peters on September 11, 2009 · 0 comments

Exit Strategies for Angel Investors – presented to the Northwest Energy Angels in Seattle, September 11, 2009

The Northwest Energy Angels invited me to Seattle to discuss exit strategies for Angel Investors.

PowerPoint PDF here

Exit Strategies for Angel Investors Video – Part 1:

Exit Strategies for Angel Investors - Part 1

  • Organized angel investing is still quite new – only ten or twelve years old.
  • Successful investing requires two things – buying right and exiting well.
  • The big ‘new story’ is the large number of small and medium size exits.
  • The ideal size for big companies to acquire is $10 to 30 million.
  • Companies are being acquired earlier and earlier – often just 2 years from startup.

Exit Strategies for Angel Investors Video – Part 2:

Exit Strategies for Angel Investors - Part 2

  • Venture Capital in North America is in crisis – big funds aren’t working anymore.
  • Traditional Venture Capital funds have grown too large for today’s exits.
  • We now have a much better idea of the differences between traditional Venture Capitalists and Angel Investors.
  • The most important differences relate to the exit – the minimum investment size, minimum return required and acceptable time to exit.
  • If a VC follows on it will add about ten years to the exit.

Exit Strategies for Angel Investors Video – Part 3:

Exit Strategies for Angel Investors - Part 3

  • Fascinating new data from the bankrupt law firm Brobeck,
  • Shows that “outcomes are inferior when angels and VCs co-invest”.
  • Angels alone are “as likely as the VC backed firms to have successful liquidity events”.
  • The optimum strategy is ‘Angels or VCs but not both’.
  • Checklist to determine whether an individual company should be financed with Angels only or VCs.

Exit Strategies for Angel Investors Video – Q&A – Part 4:

Exit Strategies for Angel Investors - Part 4

  • Secondary markets – how can angels and entrepreneurs get liquidity prior to an M&A transaction?
  • Question about whether entrepreneurs need Venture Capital investors for their relationships with the M&A buyers?
  • Why do you keep saying ‘traditional’ Venture Capital – is there a new type of venture capital coming?

Exit Strategies for Angel Investors Video – Q&A – Part 5:

Exit Strategies for Angel Investors - Part 5

  • Venture Capital investors are always saying they add more value – is that true?
  • When the IPO market returns will there be pressure to go back to the ‘old’ model?
  • How is investing in tech different from investing in cleantech or life sciences?
  • How are Canadian entrepreneurs and companies different from American ones?

Many of these lessons are described in my new book on selling businesses for entrepreneurs and angel investors – www.Early-Exits.com.

If you enjoyed this video, you might also like Don’t Blow the Biggest Deal of Your Life, Early Exits – Your Golden Opportunity, or Start at the End – Your Exit Strategy.

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