They’re called private equity investors for a reason. In the world of angel investing, the sophisticated bunch are predominantly equity investors — investors who make money on exits. If they don’t see an exit, they don’t get in. Legendary angel investor Ron Conway, for example, said he won’t invest if he can’t think of five [...]
In Part 1, M&A Exits: Sell-Side M&A Process, we briefly discussed IPO and M&A exits for angel investors while John J. Maalouf, one of the “Nation’s Top 10 International Trade & Finance Lawyers,” walked us through the sell-side M&A process for a small fictitious company called AppleSoft, whose valuation lies below US$50 million. According to [...]
Sophisticated investors always think about exits before they invest. “Does the company have the potential to go public or become an attractive acquisition target?” If not, they’d take their money elsewhere. Going public or IPO means the company raises money by offering stocks to the general public – you know, those stocks that anyone can [...]
Thanks goes to for WSJ‘s Russell Garland for taking us to the recent Angel Capital Association (ACA) Summit 2010 in San Francisco and recounting how angels and VCs rivaled for the top spot. We all like a good scrum! According to Garland, attendees listened intently to speeches about the need for angel and VC harmony, [...]
This is Part 3 of our quest to answer a reader’s question on dilution. The reader writes – How do you prevent being washed out as you keep pro-rata and the numbers get increasingly bigger? Suppose you invest $200k for 25%. The venture then raises $5m, so to keep pro rata you do $1.25m of [...]