In this series, we will share our experience of the company exit process; pointing out the challenges and pitfalls of the preparation through to the execution. By following this series we hope to help entrepreneurs define a clear exit strategy, develop a value-driven plan and, most importantly, grasp what gold standard execution entails.
A frustration of many VC’s, and a worry for many entrepreneurs is, what does our exit strategy look like? When? How? Who?
When should I start thinking my exit?
The simple answer is now. Some entrepreneurs wait for another prompt such as fatigue of founders or lack of agreement about the future direction, but this arguably too late. Fatigued founders won’t make the best decisions and a lack of agreement at the Board level will only result in tension and lack of focus on the day to day. Think about how much time and energy you put into preparing and executing your funding rounds. Now ask yourself if you have given your exit as much consideration. After all, there is no time like the present!
What’s my options?
Whilst many entrepreneurs aspire to become the next Unicorn IPO, planning for the most likely scenario is better. M&A is a very good option and probably the most likely. According to the annual research carried out by PitchBook, the vast majority of VC exits where through an acquisition, followed by a buyout, and lastly, via IPO.
What does an exit process look like?
Even the simplest transactions can turn into a much longer process than originally pictured so understanding the key milestones at the outset is important. From internal organisation matters through to the final negotiation and implementation, there will be challenges along the way and expect this to take between 4–6 months… even if you’re highly organised. We will cover more of this in detail in our following articles.
Like to learn more? Read our next article on the preparation phase of your exit process.
Feel free to share your own tips and tricks in the comments below.
About us:
We support entrepreneurs through times of high-growth and rapid change, taking the pressure off and supporting the business and your needs. Experience, structure, cross-industry best practices — those are just some of the things that we offer. Equally, by introducing new solutions and improved processes, we are able to help your business become more scalable, sustainably.
