When you start your business for the first time, your goal will probably be to start making money as quickly as possible.
As you start to see some success from your strategy, you’ll begin to look into other things, like growing your company, developing into new markets, and make sure that your books stay “in the black” so to speak.
Too often, business owners (or heirs) will decide quickly to sell all or part of a company due to death, disability, divorce, family issues, industry changes or market forces, which can jeopardize their and their company’s future.
If an owner does not have an exit strategy in place or has not given much thought to possible exit scenarios, their view of the company’s present and future value may be inconsistent with market value.
Entrepreneurs should always start their company with several long-term goals for success.
Just remember that it’s likely that these goals will change over time, according to adaptations in the market, and changes in your own personal objectives.
The most common exit strategies involve ensuring that you get the most value possible out of your business, options to consider include: As mentioned above, an exit strategy is just another plan in your business.
With your exit strategy, you can outline your road map to success, complete with ideas of what you want your business model to look like five, ten and twenty years from now.
An exit plan is where you can detail all of the different things you’ll need to think about before you leave your business, including valuations, and legal contracts.
When constructing your exit plan, think about how you want this business to help you fund your retirement.