Startup Professionals Musings

MARCH 3, 2021

For example, if you have ever watched the Shark Tank show on TV, they always ask about the cost of customer acquisition. Present a viable exit strategy for investors to cash out. Equity investors realize that they won’t see any real return until an exit occurs, such as a sale, merger, or IPO.

Exit Strategy 406

Exit Strategy Merger Angel Investor IPO 406

Startup Professionals Musings

NOVEMBER 4, 2013

Even though the Initial Public Offering (IPO) alternative for a successful startup seems to be coming back, it is relatively rare. IPOs in 2008, the market was up to a still trivial 128 in 2012 (compared to 675 in 1996). With the more popular Merger & Acquisition (M&A) exit strategy, the control stays with the new entity.

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IPO Founder Exit Strategy Investment Bankers 224

ReadWriteStart

OCTOBER 2, 2021

One primary consideration in creating a tech startup is the long-term strategy, per the owner/founder’s goals, especially regarding exit. If a founder’s goal is to grow the business for some time and exit by selling the company, through merger/acquisition, or through IPO, then the corporation (C-Corp) structure might be the best.

Technical Review 78

Technical Review LLC IPO Stock 78

YoungUpstarts

MAY 6, 2019

Is there an exit strategy? Further Customer Acquisition. You need to improve your customer acquisition process. There are two ways to exit a company. There is a complete process to go for an IPO. After an IPO, you can retire and get a new management to work for the company. Acquisition.

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Startup Technical Cofounder Merger Early Stage 113

Startup Professionals Musings

JANUARY 16, 2011

It has been at least a decade since going public via an Initial Public Offering (IPO) has been considered a credible exit strategy for startups. Usually a small company can sell about 20 percent of its stock in an IPO. In 1999, there were 486 IPOs nationwide; just 10 years later, in 2009, there were only 63.

IPO 223

IPO Social Media Media Exit Strategy 223

Startup Professionals Musings

JULY 3, 2015

For financial reasons alone, an IPO is a statistically rare phenomenon, happening just 275 times in 2014 , out of almost 500,000 startups. As an advisor and mentor to startups, I try to make sure entrepreneurs understand both the pros and cons of an IPO as an exit strategy.

IPO 120

IPO Initial Public Offering Entrepreneur Private Equity 120

Growthink Blog

DECEMBER 27, 2017

Provide a clear exit strategy. All investors are motivated by a clear picture of your exit strategy, or the timing and method through which they can “cash in” on their investment. Be sure to provide comparable examples of firms who have successfully exited. The most common exits are IPOs or acquisitions.

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Venture Capital Business Plan Technical Review Private Placement 129

Steve Blank

SEPTEMBER 14, 2009

On top of all this it was considered very bad form not to have at least four additional consecutive quarters of profits after an IPO.) The IPO Bubble – August 1995 – March 2000 In August 1995 Netscape went public, and the world of start ups turned upside down. Tech acquisitions went crazy at the same time the IPO market did.

Silicon Valley 217

Silicon Valley IPO Technical Review Venture Capital 217

Startup Professionals Musings

FEBRUARY 25, 2023

Yet one of the first things a potential equity investor asks about is your exit strategy. Here are three important reasons for the question: Good investment paybacks normally require an exit event. IPO – public company initial public stock offering. This alternative is often paired with a personal no-exit strategy.

Exit Strategy 264

Exit Strategy Private Equity Equity Technical Review 264

The Next Web

DECEMBER 22, 2016

The ultimate goal of any startup is an exit. Exit strategies fall mainly into two camps: IPO, or get acquired. Acquisitions can tell us a lot about the state of the startup world. There is of course always the third option of failing entirely, but that’s certainly the least desirable path.

Acquisition 60

Acquisition Exit Strategy IPO Web 60

Startup Professionals Musings

JULY 5, 2011

Even though the Initial Public Offering (IPO) alternative for a successful startup seems to be coming back into vogue, it is still extremely rare. companies made the IPO transition in 2009, out of thousands of startups. With the more popular Merger & Acquisition (M&A) exit strategy, the control stays with the new entity.

Exit Strategy 235

Exit Strategy IPO Investment Bankers Entrepreneur 235

Startup Professionals Musings

MAY 25, 2020

Yet one of the first things a potential equity investor asks about is your exit strategy. Here are three important reasons for the question: Good investment paybacks normally require an exit event. IPO – public company initial public stock offering. This alternative is often paired with a personal no-exit strategy.

Exit Strategy 376

Exit Strategy Startup Private Equity Equity 376

Startup Professionals Musings

AUGUST 7, 2016

Despite the fact that the number of IPOs (Initial Public Offerings) for startups have continued to decrease, I still hear it touted often as the preferred exit strategy. In fact, IPOs are down again this year, with just 31 companies going public in the U.S. Everyone dreams of becoming a billionaire overnight.

IPO 120

IPO Initial Public Offering SEC Stock Options 120

Startup Professionals Musings

JANUARY 5, 2011

So here are the most common exit strategies and considerations these days for planning purposes: Merger & Acquisition (M&A). Initial Public Offering (IPO). But since the Internet bubble burst in the year 2000, the IPO rate has declined every year until 2010, and is now at about 15%. Marty Zwilling.

Exit Strategy 231

Exit Strategy Initial Public Offering Startup IPO 231

Up and Running

JUNE 16, 2014

This is where the ‘exit strategy’ comes in. An exit strategy is not your plan for when the business fails, but rather, your strategy for returning money to investors. This may include planning for an IPO, a strategic acquisition or for management buyout.

Exit Strategy 91

Exit Strategy Advisory Board Business Plan Portfolio 91

Startup Professionals Musings

AUGUST 17, 2014

The only path to any return for equity investments is a liquidity event, like a merger or acquisition (M&A), or IPO. That’s why investors want to hear about your exit strategy. Build a path to 10x return. If you don’t have one, or intend to buy out investors with their own money, you probably won’t get much interest.

Liquidity Event 249

Liquidity Event Equity Venture Capital Merger 249

YoungUpstarts

NOVEMBER 13, 2012

For years, the most desirable exit strategy for startup companies was to go public through an initial public offering. Google reportedly turned down buyout offers from Microsoft shortly before the 2004 IPO. Google’s value has grown from $23 billion at the time of the IPO to over $200 billion today.

IPO 162

IPO Exit Strategy San Francisco Startup 162

Startup Professionals Musings

MAY 28, 2013

The only path to any return for equity investments is a liquidity event, like a merger or acquisition (M&A), or IPO. That’s why investors want to hear about your exit strategy. Build a path to 10x return. If you don’t have one, or intend to buy out investors with their own money, you probably won’t get much interest.

Liquidity Event 243

Liquidity Event Startup Equity Venture Capital 243

Gust

AUGUST 10, 2014

The only path to any return for equity investments is a liquidity event, like a merger or acquisition (M&A), or IPO. Thats why investors want to hear about your exit strategy. Build a path to 10x return. That makes their $1 million investment for 10% equity worth $25 million, or 25x.

Liquidity Event 176

Liquidity Event Equity Venture Capital Merger 176

Startup Professionals Musings

SEPTEMBER 12, 2014

Yet one of the first things a potential equity investor asks about is your exit strategy. Here are three important reasons for the question: Good investment paybacks normally require an exit event. IPO – public company initial public stock offering. This alternative is often paired with a personal no-exit strategy.

Exit Strategy 289

Exit Strategy Entrepreneur IPO Startup 289

Startup Professionals Musings

FEBRUARY 13, 2016

Technically, this is your exit strategy, usually a merger and acquisition (M&A) or initial public stock offering (IPO). I ask for five-year projections, since that’s the average time before investors can cash out. How much and when do you foresee investors getting a payout?

Sweat Equity 120

Sweat Equity Advisory Board Liquidity Event Startup 120

Startup Professionals Musings

JUNE 26, 2020

Outline a viable exit strategy for you and investors. The options here include going public (IPO), merger/acquisition, liquidate, or no exit, just paying off investors. Investors want to know how and when they might see some return on their investment, since startups require some event to show value.

Business Plan 423

Business Plan Product Intellectual Property Elevator Pitch 423

David Teten

JUNE 17, 2015

But the bad news: according to CB Insights , the average time for VCs to exit via M&A is 5 years, and via IPO is 7 years. Of course, there’s a very long tail; some of your biggest winners may take 10-20 years to IPO or exit. Roach; also see Expected Returns to Stock Investments by Angel Investors in Groups.).

Angel Investor 60

Angel Investor Angel Groups Liquidity Event IPO 60

Pascal's View

AUGUST 22, 2009

On Monday, August 10, Barron’s ran a story “Does the IPO Market Shun Smaller Companies?”, This practice has created “ a near oligopolistic hold on tech IPOs ” by these large investment banks. The IPO chasm that exists today is the result of the death of the sub $50 million IPO. jobs today.

IPO 40

IPO Merger Institutional Investors Venture Capital 40

Startup Professionals Musings

APRIL 27, 2016

Yet one of the first things a potential equity investor asks about is your exit strategy. Here are three important reasons for the question: Good investment paybacks normally require an exit event. IPO – public company initial public stock offering. This alternative is often paired with a personal no-exit strategy.

Equity 120

Equity Exit Strategy Private Equity Startup 120

Startup Professionals Musings

JUNE 2, 2013

Exit strategy. What’s most realistic these days is an exit via sale to an existing major company for which you solve a meaningful problem. That means merger and acquisition (M&A), not initial public offering (IPO). Shooting for that sort of exit over a three to five year period is usually the best strategy.

Cram Down 269

Cram Down Angel Investor Intellectual Property Venture Capital 269

Gust

NOVEMBER 4, 2011

Depending on the circumstances, they can shape the fundamentals of an exit, redistribute value among stakeholders, or even kill a deal altogether. To be sure, exiting at a 4X valuation in less than a year is not a bad investment, but it’s also not the type of exit that angels, VCs and founders usually have in mind.

Valuation 98

Valuation Pre-Money Valuation Merger Vesting 98

Startup Professionals Musings

MARCH 13, 2020

Define an exit strategy for investors to liquidate their share. They prefer a liquidity event such as an IPO or an acquisition by an existing large industry player, with a valuation at that time of five multiples or more of your projected revenues.

Liquidity Event 308

Liquidity Event Forecast Exit Strategy Bootstrapping 308

BeyondVC

DECEMBER 23, 2003

As with any smart executive who cares about the value of equity, the question I am often asked is, “What is your exit strategy.” In other words, these good exits usually happen when your company is approached by a potential buyer-i.e., What does this all mean? Remember, companies are bought and not sold.

Exit Strategy 68

Exit Strategy Balance Sheet IPO Valuation 68

www.paulgraham.com

APRIL 28, 2010

In an IPO, it might not merely addexpense, but change the outcome. Those remedial actions can delay, stall or even kill the IPO. Of course the odds of any given startup doing an IPO are small.But not as small as they might seem. Its thesame with acquisitions. The reason is thatinvestors need to get their capital back.

Technical Review 76

Technical Review Startup Software Review Angel Investor 76

discuss.joelonsoftware.com

NOVEMBER 1, 2010

Im confident that this business will be able to compensate these two additional principles along the way, after initial risk of investing their time, and will later reward their vesting with an exit strategy. This isnt really a start-up team-- Ive been doing the business for 14 years. Unethical IMO but some people make money that way.

Sweat Equity 40

Sweat Equity Equity Angel Investor Affiliate 40

The Startup Magazine

APRIL 2, 2021

Investors and entrepreneurs are very excited about the special purpose acquisition company (SPAC) model as an exit strategy for private companies. Burgundy Technology Acquisition. Northern Genesis Acquisition Corp. This type of shell company enables you to invest in companies before they go public.

AJAX 90

AJAX Early Stage Acquisition Merger 90