We covered so much ground with Eric Dobson that we had to break it into two episodes. Listen to Part 1 first and then jump into this one.

Here’s a quick rundown of the topics we cover in the interview:

• knowing your exit before you start,
• how to appeal to companies that might want to acquire your startup,
• how the word “exit” means different things to different groups of people,
• why entrepreneurs do what we do,
• the right way to use outsourcing, and
• how to build a founder team.

Specifically regarding working with investors, Eric tells us:

• what to expect as a realistic time line to getting funded from pitch to check,
• how important it is for founders to have skin in the game, and
• whether or not to ask for money capital than you need.

Why would someone want to buy my company?

There’s a new school of thought in startup financing based upon a book called Ultimate Exits by Dr. Tom McKaskill. You can download the Ultimate Exits e-book and it’s accompanying workbook for free from Dr. McKasKill’s website. (He’s also got a ton of really great e-books on Amazon.)

Eric Dobson summarizes the book’s key themes for us:

“[Entrepreneurs have] been taught our goal is to create shareholder value and [to the contrary] the book says in the short run you need to create acquirer value. The reality is if you create certain products that fill a known obvious niche for a big player you may get a speculative bump on your valuation that may far exceed anything you can drive in revenue.”

Filling an obvious niche is very much like listening to your customers to learn what they want to buy.

Eric thinks this viewpoint is full of great lessons for founders.

“If you are going to build something, build something with a need in mind. Understand who the acquirers are. Be able to names names. [For example, approach an investor and say,] ‘Here are three companies that need what I do and they would be interested in me because I’m going to do this [specific plan] and I plan to liquidate in 3-5 years.’ Just have a solid plan to [take that approach].”

Most importantly:

“You can always change your plan, but do it out of opportunity not out of duress.”

Listen to the full episode part 1 and part 2.

If you don’t know where you are going, it’s hard to know when you’ve gotten there.

Eric Dobson starts us out with a simple, yet profound statement, “If you don’t know where you’re going it’s hard to know when you’ve gotten there.” What’s more, he focuses in on his role as an angel investor.

“There’s nothing more impressive than an entrepreneur who knows the plan: ‘I’m going to accomplish this [specific thing] and I know who I’m going to sell it to.’ [I love this approach because] it shows maturity. It shows the kind of planning that you need in today’s market to get a company from its inception all the way through its growth pains and into a marketable form where someone else is going to buy it and create new wealth.”

We’re reminded of the old adage that “failure to plan is planning to fail.” What’s interesting is this runs in the face of some other advice that says “just get out there and do it.” Too much planning can cause analysis paralysis, while too little planning can leave you without a rudder. In a theme we see over and over again, being a founder is all about balance.

Listen to the full interview part 1 and part 2.

We talked to Eric for so long that we had to make two episodes (here’s part 2). You don’t want to miss the incredible information Eric shared with us, including:

• knowing your exit before you start,
• how to appeal to companies who want to acquire your startup
• how the word “exit” means different things to different groups of people,
• why entrepreneurs do what we do,
• the right way to use outsourcing, and
• how to build a founder team.

Specifically regarding working with investors, Eric tells us:

• what to expect as a realistic time line to getting funded from pitch to check,
• how important it is for founders to have skin in the game, and
• whether or not to ask for money capital than you need.

How to Use and Share Wisdom

Eric says, “Wisdom should be hard won and freely given.” These two episodes are chock full!

 The Overwhelming Urge to Start!

Eric jumps right in by explaining to us how he, “got fed up with watching great commercial opportunities cross my desk [in academia.] I wanted to do something, so I started a company to follow some of those ideas.” That company turned into two companies, and two exits.

John and Ledge hear this story in every interview. The urge to start is so overwhelming that we just can’t help chasing down that idea and starting a company! Leave us a comment if you’ve ever felt that way and followed it. If you haven’t followed the feeling, why not?

As CEO of Angel Capital Group, Eric has made a full move from “the begging side of the table to the giving side.” He thinks “it’s much more fun on this side of the table.”

 If you could go back and change anything, what would it be?

“I definitely would have done at least a business minor [in college]. Computer science was a leg up in everything I have done in life and I believe a business minor would have done the same thing.”

Also…

“I over-valued my first company very badly [while raising money]. You can’t back track fast enough if you do that.” Doing so makes working with investors very difficult.

Don’t miss Part 2! You can contact Eric at eric at angelcapitalgr dot com or apply for funding today.