You've come all this way. Now finish strong.
While there are many definitions of success, getting to an exit is certainly one of them.
Selling your business is a skill set like anything else. If you haven't done it before, and even if you have, having the right partner to help maximize value on the exit is critical.
Our team of professional investors, advisors and entrepreneurs have created successful exits in the past and we can bring this experience to bear on your company. In partnership with Founders and their investors, we develop a personalized plan that adds value to the process.
To get to an successful exit, it helps to look inside yourself to get clarity on what you want. Here's how we thing about it from a Founder's perspective.
- Think about the end game. Most startup founders are unprepared for the transition from startup to an established business. Think deeply about what you enjoy and how long you want to stick around with your startup. As the business matures, so must you as its leader. If your business is going where you don't want to go personally, it made be time for a change.
- Set a target personal destination and timing. The first step is clarifying your personal goals and the legacy you want to leave. Exiting this startup is not the end, and may be the beginning of something even better. At minimum, you need to get an exit advisor to keep you on course. While investors have conflicts of interest, an independent advisor may offer a different and more helpful perspective.
- Set your metrics and use them to gauge the health of your startup. If you intend to exit it’s helpful to think what matters to a potential acquirer. While you may have managed your business by gut feel or with numbers in your head, it's time to get your metrics on paper and packaged in a way that optimizes enterprise value.
- Create an empowered culture that operates without you. In the beginning, you and your Co-Founders did everything. A business that requires the Founders to succeed isn't as valuable as one that does not. Acquirers know the entrepreneurs will likely leave after the sale. They consider this in their valuation and willingness to complete a transaction. If the business would fall apart without you, it has limited value as an ongoing concern.
- Tune up your startup market value. Even if you don’t have a formal board of directors, it pays to have trusted advisors who will give you regular, unbiased feedback on your team strengths and weaknesses, financial and operating ratio norms, and an external view of current company valuation issues. Listen carefully and act accordingly.
- Build relationships with potential acquirers. The best sale or acquisition is a gradual one, where the acquirer gets to know you through formal and informal relationships. Don’t wait for a distressed situation in the business or your personal life, and hope that the ideal acquirer magically appears. Just like everything else, it's up to you to manifest your vision into reality.
- Add more robust business processes and keep growing through, scalable, repeatable processes. Secure your company’s sustainability through multiple revenue streams and customer sets, and solid core business processes. Build an exit-transition plan for yourself, and a plan to retain key talent on the team. Anticipate customer and valued-supplier reaction to any change.
- Transition from day-to-day operations into external company salesperson. Well ahead of any planned move, you need to assemble hard data to support your historical and projected performance and sustainability. Your valuation and salability depends on the credibility of this effort. Plan to spend 30-60 percent of your time away from running your business during this phase as you backfill your role with business leaders than can take responsibiltiy for what you used to do.
- Lead your way out rather than wait for a push. The win-win startup acquisitions and successful transitions to established companies are led by the entrepreneur, rather than happen passively. You need to proactively engage the right people, drive improvements where required, and pay attention to all the external and internal factors gating success.
We can advise and guide you through the process. We will help you determine where your strengths are and how to complement your skills with an experienced exit professional.