Tech Coast Angels Chairman elect Richard Sudek has handed out 20 copies of Spencer Johnson's Who Moved My Cheese to grease the wheels of resistance to change prior to our 2nd annual offsite strategic planning day set for tomorrow at Chapman University. It's a great start for his reign and might be just the nudge we need to rethink some of our processes. As a 12 year old angel group, it's easy to get set in our ways. Maybe angel groups are especially prone to resistance to change because their members aren't exactly spring chickens. We all become more comfortable with the routine as we age and the nature of angel investing is making many of us older fast. Once venture capital makes an investment in a portfolio company our timelines to an exit are growing well beyond the 3-5 years we all imagined when we started angel investing; today we're more likely to see 7-8-9 years (and counting) to exit, so we're only becoming more prone to being set in our ways. I often say that the original founders of TCA, many of whom are still involved, weren't so young 12 years ago.

But speaking of books that might prompt change, Basil Peters' Early Exits gets my vote for Book of the Year. The premise is refreshingly simple: as soon as you fund a company get started on crafting the exit. Too often it seems we let the company muddle along on its own and as the cash reserves get thin the founders make the venture capital pitch. But venture capital has to put a lot of money to work, the average venture fund being $250M, and they need big exits to make the fund successful and billion dollar exits don't happen overnight. Contrast this with Basil's concept of funding a startup entirely with angel fundings, maybe 2 or 3 small rounds, then finding an exit partner to acquire the company for somewhere in the $20-30M range. Angels get a nice return, entrepreneurs often see a 100X return and we get out of the deal in much less time.

Our angel peers in the life sciences need venture capital relationships to fund their ambitious startups, but that's their model and it works for them. Too many times we've been tempted by the siren song of venture capital, as my recent guest, Momentum's Andy Wilson, has admitted, and end up with less well-suited deals involved in endless timelines as venture capital seeks their ultimate objectives. Meanwhile we're getting older.