I Exited My Company in Just 7 Years — Here's 3 Things You Need to Do to Have a Successful Exit

May 23, 2024 12:30 AM - 5 months ago 53551

Opinions expressed by Entrepreneur contributors are their own.

Building and establishing a institution from nan crushed up is often nan dream for galore entrepreneurs — pouring their hearts and souls into their imagination and watching it toggle shape from an thought into a surviving entity. But sometimes, nan extremity end isn't conscionable to create but besides to create pinch a successful exit successful mind. A profitable initial nationalist offering (IPO) aliases a strategical acquisition by a bigger institution tin beryllium really nan communicative of years of laborious efforts ends for galore entrepreneurs, yet starring to financial independence.

Having exited 2 of my ain companies and coached countless others done nan process, I've learned a batch of things successful penning an exiting story. Sure, nan financial rewards are undeniably enticing, but it is besides important to admit that exiting isn't ever nan champion option. In fact, a strategical exit hinges connected 3 cardinal factors: recognizing nan signs that nan clip is right, meticulously preparing your institution for a smooth transition, and knowing erstwhile holding onto nan reins mightiness beryllium nan wiser choice.

Related: Your Company May Have a Costly Trust Problem. Here's How to Fix It — And Boost Your Profits.

1. Pay attraction to nan signs and admit erstwhile it's clip to exit

The determination to exit isn't and has ne'er been a ray determination that tin beryllium made overnight aliases wrong a azygous meeting. It's a pivotal infinitesimal that will effect an entrepreneur financially and style nan business's future.

They opportunity that timing is everything, and I couldn't work together more. Look for periods of favorable marketplace conditions, specified arsenic precocious request for your circumstantial manufacture aliases technology. Just for illustration my 2nd venture, which capitalized connected nan booming marketplace for large information successful location care, aligned my exit pinch a favorable marketplace upswing. The determination importantly accrued nan company's value.

It's besides important to admit that sometimes, your skillset is nary longer nan driver of your business's growth. I knowledgeable this, which prompted maine to bring successful exceptional talent erstwhile my past institution matured. That determination strengthened nan company; if I hadn't recognized really my contributions had plateaued, nan institution would person struggled to climb to caller heights. Understandably, you mightiness consciousness for illustration nan astir logical action is conscionable to exit nan company. However, stepping backmost to a mentorship role could beryllium a acold amended replacement truthful you tin proceed to lend strategically without hindering nan business's growth. But again, this is not different determination that could beryllium taken lightly; it requires thorough evaluation.

2. Prepare your institution for a successful exit

Before you get swept by dollar signs, you must reside 1 of nan astir important aspects of a successful exit, which is often overlooked — due diligence. Traditionally, nan attraction has been connected nan buyer's owed diligence process. However, it's arsenic important for you to analyse nan buyer. Research your buyer's past acquisitions, tally a "background check" of sorts, and get accusation connected really their past acquisitions went. If you could, scope retired to their existent labor arsenic well. This doesn't make you a weird and paranoid seller; it conscionable proves really you're committed to looking aft nan business moreover erstwhile it's sold, ensuring it runs smoothly and thrives successful nan future. After all, owed diligence is simply a two-way street. This level of scrutiny besides allows you to understand their culture. One costly correction I made successful my first exit was losing attraction during nan buyer's owed diligence process, which lasted 4 months. My company's maturation stagnated, and our valuation dipped. Red flags are arsenic important arsenic dollar signs, truthful don't deliberation doubly to locomotion distant if their values conflict pinch yours.

Related: How to Strategically Exit arsenic a Leader

3. Develop a post-exit strategy for continued engagement

An exit strategy tin undeniably motivate galore entrepreneurs — a awesome chance to rate successful and move on. However, it shouldn't ever beryllium nan eventual goal. Does money measurement much than your legacy and vision? Perhaps. But that's yours to decide. Money is only 1 apical facet erstwhile deciding to exit; for me, it's ne'er nan astir important. I worth surviving my champion life arsenic an entrepreneur, ensuring that each my ventures create state for myself and my family.

Suppose you've successfully built a business that runs smoothly without your changeless involution and still provides you pinch financial state and nan clip to prosecute different passions. In that case, I deliberation trading mightiness not beryllium nan champion idea. Personally, I besides find it very satisfying to lead and further turn a thriving business, often much satisfying than getting paid once.

But assuming you pursued trading it and you exited, what comes next? You commencement pinch different imagination and commencement pinch caller strategies. Wouldn't it pain you out? Would it make you much fulfilled to commencement complete and over, repeating nan aforesaid process of creating and trading for money? Maybe, aliases possibly not. The constituent is you person to create a post-exit scheme that doesn't dim nan ray of your burning passion. It's okay to region and bask a well-deserved break. Don't suffer your northbound star; strive to make your life much fulfilling, measurement beyond money talks.

Related: 8 Lessons Learned From Building and Selling a Startup

Build a legacy, not conscionable a bid of sales

The meaning of happiness and occurrence whitethorn disagree from personification to person, depending connected what motivates them to aftermath up each day. Is it nan regular grind that motivates you? Or astir apt nan challenges of building thing from nan crushed up? Regardless, you person to retrieve that arsenic an entrepreneur, occurrence tin besides mean recognizing your limitations and knowing erstwhile to stop. This goes beyond ensuring your creation's early occurrence and nan dancing dollar bills successful your head. Entrepreneurship is much than conscionable money. It's astir your bequest — study to take lasting effect and individual fulfillment complete hefty paydays.

More