Always plan an exit path to mitigate against existential risks and maximise your upside potential

When we work with start-ups and SMEs, we always ask the exit questions. Have you planned one? Should you? When? Whom? Etc. That is why I picked up “Exit Path: How to Win the Start-up End Game”. A business plan without an exit strategy is only half complete as it leaves unanswered many important strategic questions about the ultimate fate of your start-up — the “who,” “why,” “when,” and “how” of an eventual exit.

The reality

Let’s start with the reality; you might have no choice.

• Only one-third of small businesses survive beyond 10 years.
• 75% of start-ups that raise more than $1 million do not manage to return the money invested in them

Exit as an option

Most entrepreneurs and their stakeholders are unwilling to sell until they are desperate to sell, waiting until they have exhausted all viable alternatives to a sale, which is pretty much the lowest selling position they can find themselves in. Exit should always be one of the options. Selling your start-up at the right time, to the right strategic buyer, on the best possible terms is what you should consider as one version of success.