Entrepreneurial Exit Strategies

With the fun and lazy Labor Day holiday behind us, we begin to look at life goals. What would it take for everyday to be a Labor Day holiday? What do I need to do to be able to go boating out on the lake with family, or travel, or do nothing all day if I wanted? Let’s project months, or years down the road into the future and start looking at exit strategies.

I suppose one of the first things you need to have is a goal to exit.  Many entrepreneurs still in the prime of involvment don’t want to hand over control of the “show” just yet. Many of you do. Let’s all start by agreeing the in order to make this exit strategy work, there has to be a real desire to exit.

Second, you may want to get some type of orientation of where you are currently. Like a Shopping Mall map with a star that indicates where you are in relation to all of the stores in the complex, we need a better understanding of “where you are” – not just your business, but also your personal finances.   Afterall, the overall plan is to provide a way for YOU to personally stop doing what you are doing and begin doing what you want to be doing.  It isn’t just about the business anymore, it is about you.  It is time for you to perhaps have a personal finance and business valuation. See where the gaps are.

Third, the “actual exit”. What are you going to be doing? Are you selling, phasing out, or recapitalizing? What is the plan and how do you see yourself capturing the full value of the business. There are many arrangement which can me made from a legal buy-sell agreement to employee owenrship.

Next, what do you plan on doing with the money? Simple question, but many less experienced entrepreneurs would end up foolishly squandering their hard-earned fortunes with undisciplined spending and accounting practices. Make sure you know how you plan on keeping as much of the proceeds as possible.

Finally, set some guidelines and benchmarks. You will never know if your plan is moving too fast or too slow for your liking if you never set any timelines for things to occur. Before you know it, your goals have passed you by. Look to the future…I promise you it is as bright as you make it.

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