“We WILL be there with you every step of the way.” 

Why Think about Exits

There are two very real and practical reasons why you need to plan an exit:

• • Return for Investors. Remember that equity investments are not like loans with interest. The investor sees no return until he cashes out, or the company is sold. Even three years is a long time to wait for any pay check.
  • Entrepreneurs Want to Do It Again. Assuming your startup takes off, you will probably find that the fun is gone by the time you reach 50 employees, or a few million in revenue. The job changes from creating to operating. You will be anxious to start a new entity, with new ideas and spinoffs that have built up in your mind, and certainty that you can avoid all those potholes you hit the first time around.

To some, an exit strategy sounds negative. Actually, the best reason for an exit strategy is to plan how to optimize a good situation, rather than get out of a bad one. This allows you to run your startup and focus efforts on things that make it more appealing and compelling to the short list of acquirers or buyers you target. Planning for your exit may seem premature, but the things you think about today can have a real impact on where you end up.