SeedBlink Blog

Here's a truth most investment platforms won't tell you: you don't have to wait for an IPO or acquisition to cash out your startup investments.

After working with thousands of retail investors across Europe, I've found that the conventional wisdom of "patient capital" doesn't always align with real-world needs. Life happens. Opportunities arise. And sometimes, frankly, you just want to take your gains and move on.

The standard narrative is that startup investing requires monk-like patience: put your money in, wait a decade, and pray for that unicorn exit. But this one-size-fits-all approach ignores the reality of most retail investors who want more flexibility with 2-3 year horizons, not 7-10.

Let me share how strategic retail investors I know approach exits on their own terms.

The next funding round is your first clear exit window

Recently, an investor told me something that stuck in my mind: "The best time to sell is when everyone else wants to buy." Nothing creates buying interest like a startup raising a new round.

When a startup raises a new funding round, a clear, defensible valuation is established. This eliminates the most frustrating aspect of private market exits – the ambiguity of price.

Last year, one of our platform investors put €20,000 into a fintech startup's seed round. When the company raised its Series A 18 months later at a 3.2x valuation, she sold half her stake to an incoming investor. She recouped her initial investment while keeping significant upside exposure.

Why next-round exits work:

1. Transparent pricing – The new valuation provides a clear benchmark
2. Natural buyers – New investors are already excited about the company
3. Founder-friendly – The cap table stays "clean" with qualified investors
4. Timing advantage – You don't wait 7+ years for liquidity

When selling during a new funding round, offering your shares at a 10-20% discount from the new price creates an irresistible opportunity for buyers while still capturing most of your upside. This small concession dramatically increases your chances of a successful transaction and provides the liquidity that might otherwise be years away.

Many founder-friendly VCs will quietly facilitate these transactions, especially if you're selling a portion rather than exiting completely. After all, they're in the business of buying equity – it's not strange to ask if they want more during a funding round.

Secondary markets: for when you don’t want to wait for the next round

"I don't need a home run on every investment. Singles and doubles work just fine if I can reinvest quickly."

That's what a retail investor with an impressively successful track record told me after closing his third secondary sale in two years.

The numbers speak for themselves: on SeedBlink alone, Bulletin Board transactions have reached €1.76 million in total value, in a timeframe of only 2 years.

What makes secondary sales work:

1. Timing flexibility – You decide when to sell rather than waiting for company events
2. Partial exits – You can sell a portion of your holdings to diversify risk
3. Reinvestment cycles – Take gains from winners to place new bets, compounding returns
4. Risk management – Exit companies when your thesis changes or progress slows

Last quarter, we helped a retail investor sell their stake in a SaaS startup growing more slowly than projected. The company wasn't failing, but the path to a large exit had lengthened considerably. The investor took a modest 1.4x return after 20 months, freeing up capital for opportunities better aligned with their timeline.

The key to successful secondary transactions is realistic pricing. Expect a 10–30% discount on the last round valuation unless the company is dramatically outperforming projections. Plus, these transactions typically come with lower exit-associated costs—just 3% on each transaction in our case, versus higher success fees (often 15-20%) that might come with traditional exits.

The unspoken exit: when VCs want you out

Sometimes VCs actively want retail investors off the cap table as companies mature. It’s not otherworldy to hear VCs discuss "cap table cleanup" before Series B or C rounds. While it sounds clinical, it's really about consolidating ownership and reducing administrative complexity.

This moment – when VCs are motivated to remove smaller shareholders – creates yet another exit opportunity for retail investors.

Why these transactions work:

1. Motivated buyers – The VCs have strategic reasons to complete the transaction
2. Fair pricing – Usually based on the latest valuation with minimal discounts
3. Efficient process – The company often handles administrative aspects
4. Clear communication – Terms are typically well-defined and non-negotiable (in a good way)

While you can't control when these opportunities arise, you can position yourself by investing in startups likely to attract serious institutional funding.

Reality check: this isn't for everyone

Let's address the elephant in the room: early exits aren't always possible, and they almost always involve trade-offs.

For every successful 2-year exit story, many investments simply don't offer early liquidity options. About 30% of startups fail outright, and many more enter a zombie state where they're neither failing nor succeeding dramatically.

The investor focused solely on maximum return potential should probably stick with the traditional approach of long-term holding. But if your goal is to build an actively managed portfolio with more frequent reinvestment cycles, these strategies could transform your approach to startup investing.

P.S. A personal note on risk management

The uncomfortable truth about startup investing is that most retail investors focus entirely on picking winners while ignoring exit strategy. But knowing when and how to exit is just as important as knowing what to buy.

I've seen too many retail portfolios where 80% of the value is locked in illiquid positions with no clear exit path. Meanwhile, promising new investment opportunities pass them by because their capital is trapped.

Is the potential for a 50x return in 10 years really better than three consecutive 3x returns over the same period? The math actually favors the latter (3³ = 27x), with significantly lower risk and more optionality.

Smart investors don't just think about getting in – they plan their way out from the very beginning.

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Written by Ionuț Pătrăhău, Managing Partner and Corporate Development @ SeedBlink. In addition to his extensive experience in banking, Ionuț Pătrăhău has also worked in the healthcare sector. Prior to founding SeedBlink, he was the CEO of the private healthcare network Regina Maria and co-founder of the Brain Institute, a neurosurgery center developed in collaboration with Monza Hospital.