Founders Should Think Before They Raise

The CB Insights report on private tech company M&A in 2012 just came out and there are some very interesting trends highlighted by the report. Overall, 2,277 private tech companies were acquired for an aggregate disclosed value of $46.8 billion. Interestingly, 50% of the exits were for less than $50 million and 76% of the companies had not raised any venture financing prior to their exit.

This highlights just how careful and thoughtful entrepreneurs should be when they consider venture financing. For most venture-backed companies, an exit for less than $50 million is nothing to write home about. Yet for a team of founders with perhaps the help of some angels, a $50 million outcome can be quite meaningful.