An IPO is not an exit. It is an entrance. It is an insertion of a profit-scope — you should be enthusiastic about inserting it; you should take it on vacation with you,” said Scott Ingraham, former CEO of Rent.com, causing a group of some 250 business men and women to burst into laughter during a San Diego Venture Group breakfast meeting.

The group of entrepreneurs, capital providers and advisers came together May 24 to hear about the process of the exit strategy, investing trends and some of Southern California’s most recent successful transactions.

Although panelist John Mutch, partner of MV Advisors, told companies interested in a sale or merger that investors look for growth, profitability and great culture/people, Doug Gonsalves, managing director of SVB Alliant, was quick to add that in the end, the bottom line is investor return.

Panelists also noted that although a founding CEO may think of his company as a family, investors tend to be less attached. As a result, employees may depart as the company culture, built around the founder, changes.

The panelists say establishing trust early with the new owners will make an exit from a company easier and less painful. Both parties also need to be realistic going into the deal about the company’s value. Sometimes it is hard to find such common ground. “Clearly someone else is somewhere else with realism,” Mutch says.

“Exit Strategies: The Final Frontier,” was both informative and entertaining as the panelists used humor and case studies to keep the early-morning crowd’s attention and provide sound advice on exit strategies.

The San Diego Venture Group holds nine monthly breakfast meetings throughout the year. More information is at sdvg.org.

— Sarah Strause