Why do investors go out?
Valuation comes first (105 of 457 exits with a reason), then competition (84) and business model (81).
Valuation is the top reason to go out
When an investor goes out (says no to investing), the analysis records the reason they gave. If they gave none, it records the reason their own words around “I’m out” point to. A total of 457 such exits carry a reason. Valuation leads with 105, followed by competition (84) and the business model (81).
Together these three reasons explain more than half of all exits. Product quality and the founder rarely come first. Investors leave over the deal and the market more than over the person.
What was said
Mohamed Ismail Mansour
Went outThis valuation is too high for me, so I'm out as well.
Picado (بيكادو) · S1 E6 · 10:21 · Paraphrased
Abdullah Sallam
Went outI'm a bit concerned about the high valuation, the unclear business model, and the fierce competition, so I'm out.
2Turu (2Turu) · S1 E5 · 14:05 · Paraphrased