It doesn’t matter what industry entrepreneurs are in, what country they live in, or how many people are involved in the business. One thing is for sure: they almost always lack an exit strategy.
Maybe you think you don’t need one. Perhaps you want to leave the business to your kids when you pass. Perhaps you want your business partner to take over. Maybe you dream of selling big someday. Whatever is in your head, we need to get that plan on paper and start on the strategy immediately.
When do you begin the exit strategy? When you start the business.
If you don’t own a business, you probably think you are excluded from this discussion. Uh, no.
I’m not sure why, but exit strategies have always fascinated me. I’m the type of person who thinks about the exit as soon as I begin anything.
If I’m writing, I’m wondering all the things this content will become.
If I’m buying a stock, I want to know when I will sell or when I will buy more.
Before I became an entrepreneur, I always needed a plan when accepting a job with a company. How long will I stay? What could happen that would make me leave? What position in the company did I really want?
Maybe your plan is to stay until retirement (whatever that means). What then? What does retirement look like? How can you mold it to your fancy? Write it down.
Visualize yourself and your family in 10 years. Where are you? What are you doing? What’s different? How are you making the world a better place? Write it down.
According to the Edward Lowe Foundation, there are a number of steps in creating an exit strategy.
Decide on a target date for a change in your role.
Get feedback from your family or investors. They need to be aware of your thinking.
Create the plan. You can sell the company to your children, to employees, or to a strategic or financial buyer. You could also merge with another company. If you work for someone, what would trigger a move? Where do you want to go inside the organization? Maybe you should write down some target dates.
Once complete, publish the plan. Your management and family members should know your intentions. One of the best things we did when we sold Content Marketing Institute was making sure the management team knew ahead of time and was compensated on any transaction.
When you’re ready, start implementing the plan.
What have I learned about exit strategies? You can never be over prepared. You can never review it too many times. And finally, actually write it down on paper and keep it close to you. When the curve ball comes (and it always done), you’ll be prepared.
Here’s a video of my strategy for writing and reviewing goals like this.