If you have come to this stage it means you want to know what’s next after the company started to pay you back and revenue stream is nice too. Stay with us, it is the last article of this series you are reading.
For a founder of the company, this stage may tinge his/her heart a little. I mean starting a journey from Vision and talking about dreams and future and leaving a legacy behind all may sound like drifting away and losing something when we talk about an exit strategy for a startup.
The Exit Strategy is not something people gave thought to in the beginning but afterward practicality, and the business world demands to earn maximum profits from it. Investors are the main reason for it who want to have max profits from the investments they have made into your startup.
Exit-strategy is defining the outcome of your startup. And maybe selling it to start something new. The joy of starting something new is lasting than from just managing a company who has taken a steady shape.
Following are the ways to exit route to end this journey.
- Join someone bigger: if some bigger company is ready to acquire and merge you in its fold then it would be beneficial for your startup. And, investors would be happy too. Big corporations pay a large amount of money for your startup.
- M& A formula: Merger with great companies is also a great and popular opportunity available for startups. And it would come under the umbrella of big company which has professionals to take it from here to new heights.
- Cash Cow: Well, maybe you don’t want to exit at all. If your company is growing and you focused on upscaling sales tremendously. Then that would be beneficial for all the parties involved in this business.
- Initial Public Offering: According to funding sage, companies who are not being offered big deals from bigger corporates are interested in this option. However, for IPO it is suggested that your focus should be on stakeholder’s relationships, risk management, and some attention should be given to the tax details as well.
- Managerial profile: Look for people who like to work in stable environments and have greater ambition than you for your current startup. They would be your target to put the focus on and persuading them would be a win/win situation for you and them.
An important question: what’s the right time for applying exit-strategy?
There is no clear-cut answer to this question. It all depends upon your product, and market trends at that time.
You can stay as a founder of the company if you want to even after selling some shares of the startup for paying back to the investors and can take the company to a direction you may have envisioned originally in your dream for it.
Good Luck for future adventures!