Early Exits Workshop – Silicon Valley – Part 1

BY Basil Peters

Sponsored by the Angel Capital Education Foundation and the Angel Capital Association
presented at the Angel Capital Association National Summit, Silicon Valley May 5, 2010

Part 1 – Angel Investing in the 21st Century

Part 1 PowerPoint PDF is online here.

Part 1-1:

  • Outline of the Early Exits Workshop and how I got started on Early Exits
  • Successful investing requires two things – investing right and exiting well
  • Angels and entrepreneurs would have more fun and make more money if we focused more on our exits
  • Angel investing is still new – about where traditional Venture Capital investing was in the mid-1980s
  • The economy has changed and traditional Venture Capital isn’t working for today’s tech companies

Part 1-2:

  • What happens to angels and entrepreneurs when traditional VCs invest in our companies?
  • When VCs invest, on average it adds about a decade to the exit timeline – the math explains why.
  • The best strategy is to have angel investors or traditional VCs – but not both – university research shows
  • When do traditional Venture Capital investors make sense for technology companies? A simple test for each company.

Part 1-3:

  • Most M&A exits are under $20 million – because that’s what works for the acquirers in today’s economy
  • The media does us a disservice by writing stories about the really big exits – which aren’t happening as often anymore
  • Examples of these exits and why they are happening now – under $20 million is easy
  • Big companies have lots of cash and are starting to consider traditional VC funds as their competitors
  • Google wants even earlier exits – their sweet spot is under $20 million and they prefer pre-revenue companies
  • There are many other types of buyers today including medium-sized companies and even boomer entrepreneurs

Part 2 is online here.

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

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