[gorgoiler]

Is it a thing for angels to exit in the early rounds?

Instead of being shoved down the cap table by a giant tranche of series A preferred stock, might it not be appropriate to give the angel a payday instead?

I guess some angels want to keep their fingers in the pie? And, more likely, it’s just not a reasonable expectation to see an exit like that way before anyone else does?

[motoxpro]

It’s just the same thing as a take profit in the stock market. Intellectually it seems reasonable but because a lot of the bets go straight down (never raise another round for that take profit opportunity) you need a higher multiple of the ones that win.

You end up taking profit at a 1.1 return and in 10 years it ends up being uber.

Positive skew strategies (lose a little on a lot of bets and win big on a few) are impossible to use take profits on because you need those big winners.

[DrAwdeOccarim]

Yea, I’ve seen cashing out the principal+next investment and letting the rest ride.

[chii]

early exits probably won't get the type of return that an angel investor would be interested in monetarily, since you need more than fu-money to motivate them.

[paulddraper]

No Angel investor is looking to 2-3x their money.

That’s not why they do it.