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Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
Rob Wiltbank - Presentation to Tacoma Angel Network
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Rob Wiltbank - Presentation to Tacoma Angel Network

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Title: The Economics of Creative Destruction or Making money from growing things …

Title: The Economics of Creative Destruction or Making money from growing things

Wiltbank is the foremost leader on Angel Investment Outcomes.

His Book, The Catalyst, is available on Amazon @ http://www.amazon.com/Catalyst-Become-Extraordinary-Growth-Leader/dp/030740949X

Published in: Business, Economy & Finance
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  • 1. The Economics of Creative Destruction or Making money from growing things <ul><li>Angel Investment Outcomes </li></ul><ul><li>Key Strategic Choices </li></ul><ul><li>The Catalyst </li></ul>Robert E Wiltbank, Ph.D. Associate Professor of Strategy & Entrepreneurship Willamette University Partner, Buerk Dale Victor LLC 503 715 7894 [email_address]
  • 2. Distribution of Returns by Venture Investment Red Bars: U.K. % of exits in that Category Blue bars: U.S. % of exits in that Category UK: Overall Multiple: 2.2X Holding Period: 3.6 years US: Overall Multiple: 2.6X Holding Period: 3.5 years Approx 22% IRR Approx 27% IRR Hold: 3.0 yrs. Hold: 3.3 yrs. Hold: 4.6 yrs. Hold: 4.9 yrs. Hold: 6.0+ yrs.
  • 3. <ul><li>Entrepreneurial expertise is significantly related to better outcomes. </li></ul><ul><li>Particularly true in earlier stage investments. </li></ul><ul><ul><li>Angels with entrepreneurial experience do significantly better in early stage deals than investors with less experience. (0/1/2 ventures, vs. 3 or more) </li></ul></ul><ul><li>Expertise in the industry of the venture also valuable. </li></ul><ul><ul><li>Significantly related to a reduction in investment failure </li></ul></ul>Investor Expertise
  • 4. 60% better multiple for deals related to industry expertise
  • 5. <ul><li>Interaction: hi interaction had significantly less failure </li></ul><ul><ul><li>Low interaction failed 61% of the time </li></ul></ul><ul><ul><li>Hi interaction failed 44% of the time </li></ul></ul><ul><li>Board Role: related to better returns </li></ul><ul><ul><li>The largest effect size in regressions </li></ul></ul><ul><li>Passive vs. Active </li></ul><ul><ul><li>Passive was significantly related to smaller investments and worse returns </li></ul></ul><ul><li>Managerial Role: more participation isn’t always better </li></ul><ul><ul><li>While only about 15% of exits, where an angel was involved in a managerial role, returns were significantly less attractive. </li></ul></ul>Participation post investment
  • 6. 4X better multiple to Board Involvement
  • 7. 2X better multiple for 20+ due diligence
  • 8. Follow-On Investment from Same Angel Investor 3X better multiple in deals where the investor did not make a follow-on investment. 30% of deals had follow on investments.
  • 9. <ul><li>Not Rocket Science: Just good business. </li></ul><ul><ul><li>Staying connected to your expertise is a good idea. </li></ul></ul><ul><ul><li>Even a relatively small amount of due diligence helps avoid failure. </li></ul></ul><ul><ul><li>Interaction post-investment is valuable to a point. </li></ul></ul><ul><ul><li>Follow-on investments are significantly related to lower returns. </li></ul></ul>Better angel investing
  • 10. <ul><li>Based on an in Depth Study of 50 Corporate Leaders that led incredible revenue growth projects. </li></ul><ul><ul><li>NOT a book about organizing, conceptualizing, or considering growth </li></ul></ul><ul><ul><li>A book that gets into the specifics of leading growth when you are on the hook </li></ul></ul><ul><ul><li>Lesson 1 : Don’t look up look in </li></ul></ul><ul><ul><li>Lesson 2 : The monkey isn’t on your back, it’s in your head </li></ul></ul><ul><ul><li>Lesson 3 : It’s already there: reframe to find it </li></ul></ul><ul><ul><li>Lesson 4 : Small is beautiful </li></ul></ul><ul><ul><li>Lesson 5 : Lead with pragmatic idealism </li></ul></ul><ul><ul><li>Lesson 6 : Speed Thrills </li></ul></ul><ul><ul><li>Crown Publishing: NY, NY </li></ul></ul>
  • 11. A Passion for Two Worlds <ul><li>Irony </li></ul><ul><ul><li>Entrepreneurs wish they were the incumbent. </li></ul></ul><ul><ul><li>Incumbents wish they were more entrepreneurial. </li></ul></ul><ul><li>Growth Leaders live at the intersection of these two worlds </li></ul><ul><ul><ul><li>… .and love it. </li></ul></ul></ul>
  • 12. mix the best of both worlds <ul><li>Co-Create with Early Yes’s </li></ul>Leverage Your Organization Small Bets … Fast Pragmatic Leadership Design for Scale Enter with Competitive Intent YES Entrepreneurial World Corporate World The Catalysts

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