The 18 Year Angel Investment

Janss Investment Company Building, 1045-1099 W...
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A few days ago I was talking to an angel investor about his experiences. From a previous conversation I knew he had a nice exit four or five years ago so I asked what he learned from his experience in that deal. After he shared some takeaways I casually asked when he first invested. His answer shocked me: from the time of first investment to selling the company it took 18 years. There’s been talk for a couple years now of exits taking longer and that angels should expect deals to take 7-10 years for an exit. 18 years for an exit seems like an eternity.

Some interesting notes on the 18 year angel investment:

  • The angel investor invested in the company three times over the first five years
  • The company had several small pivots before finding a market opportunity
  • The company was close to running out of money when the founder died and the company had a $1 million life insurance policy which provided it capital to keep going
  • A new management team was brought in and was able to make the company successful by signing distribution deals with several large companies

His stories drove home the fact that things take longer than expected and a good bit of unplanned events are part of the journey.

What else? What other stories have you heard about angel investments taking a long time?

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