Here are 5 exit strategies for great business acumen

Just as you would have a great business sense to make it big in the world of old and new businesses, you also need another most important skill. Conventional business models may not agree with this, but as time and the way businesses are conducted have changed; a good exit strategy is the most imperative aspect of doing business.

However, exit is often seen as a counter-productive is the most misunderstood aspect. But, experts will tell you that planning your exit strategy well in advance, even as you are a well-funded startup, is something imperative and a step every smart entrepreneur will have to eventually take – sooner the better because you are still at a point when you can help things from spiraling into the centre of gravity.

An exit strategy is important to ensure you have left the place hale & hearty, made a name and a reputation for yourselves in the world of business and that you are now ready to leave the warmth of a well-oiled startup in order to start something more exciting, and may be even better! It keeps the juices flowing, both within you and within the company you so dearly loved!

Let go, the keyword, can give a fresh lease of life for everyone involved.

In some ways, if you observe the investor predicament, not exiting would mean no returns on their investment and this is bad for business.

When exits don’t happen as planned, or without making it an issue of discussion, or an important agenda in the meeting, no-exit means no returns for investors. Having some minority or majority share in a company, with no exit in sight is much like fishing in icy waters. You have no clue what’s down there, and if there is anything down there worth your time and energy at all.

Founder of highly successful CBay Systems, V. Raman Kumar, makes a candid point when he says: “Keeping your investor happy and being disciplined is important. The right money at the right time and right exit strategy at the right time is crucial.”

Here are a few exit strategies that can help you make that right decision at a time when you deem it right. Do it fast, and do it swiftly!

IPO way
IPO exit is the most preferred and safe way of exiting in the current scenario if you plan for it. But, it is also important to remember that only small percentage of startups exit this way. It is imperative to structure your business in such a way that an IPO exit can not only be hassle free, but also the most convenient way of doing it!

Aim big, and go big or as they say, just go home! Your energies should be focused on product/service or customer segment that will generate large numbers of users and swift growth.

Liquidate
This is something a lot of entrepreneurs can never get it right. One of the most conventional and most often overlooked exit strategy is call it quits, hang up the boots and take a hike in the woods. It’s easy, and natural. Everything comes to a natural end and there’s no worry about handing over the keys to someone else. If you liquidate, the money usually gets repaid to the creditors and then is shared among co-workers, or whoever stayed back to switch off the lights and shut the systems down.

Sell, sell and sell
You are high-strung about whatever you set up that you didn’t train sights enough to notice if someone else could have reared the dream with as much passion or wanted to possess it as much as you did.

When time is ripe for exit, consider who you could sell the business to. It could be an external person, or your own co-workers with dreamy eyes. Someone can bring fresh blood and make the business go up on the charts again, while you go chasing new dreams; not a bad idea at all!

Steer towards lifestyle
This model, which has the legendary Tim Ferriss for the most prominent name, suggests that your exit strategy should be to set up a corporation to scale down the losses. Once your business reaches the desired scale at any particular time, you should plan to live off the cash flow without hands-on involvement. In this phase, you need to focus on promising niche segment of the market, cut the spending and tap funding sources for fresh investment if need be.

Merger and acquisition
This would normally mean going into a similar company or allow your business to be bought by a larger company that can benefit from the merger and acquisition. This is the most important and most beneficial situation where both companies win, combine resources and grow into something more that can change the direction of the market.

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