Last week I wrote about the business that's outgrown the word startup but is still calling itself one, because keeping the label means nobody has to build the systems that should have existed years ago. If you dropped the label this week, there's a harder question sitting right behind it, could you actually leave?
When Stuart and I were building Epic Pharmacy and Icon Group, we started thinking about our exit almost from the beginning, not because we had any plan to check out early, but because we wanted to protect our options. It changed how we structured deals, who we hired into leadership, the reporting frameworks we built, and how we talked to the people around us about where the business was heading.
Exit isn't a project for later
That surprises people. Exit strategy sounds like something you think about on the way out, a project for year eight or year twelve, once the growing up is mostly done. But by the time you're actually weighing up a sale, a merger or handing over to someone else, it's too late to build the things that make any of those options possible. The exit doesn't create the optionality, the optionality has to already be there, built in years before you need it.
If you are the product, there isn't much to sell
The clearest sign of a business that isn't ready is one where the value is tied up in a person rather than the business itself. When every important relationship, every piece of institutional knowledge and every hard decision runs through you, there isn't much of a business to sell, more a job with your name on the door that somebody else would have to be talked into buying.
What actually makes a business transactable
A handful of things tend to separate a business that's genuinely transactable from one that only looks that way on paper: whether the important relationships and decisions would survive you taking three months off, or whether they still run through you; whether your books, ownership structure and intellectual property are clean enough to survive a due diligence process, or whether there's a story you'd need to tell someone before they saw them; whether you've actually looked at how businesses like yours have been bought, sold or merged, and what made the ones that sold well attractive; and whether the way you're building today would hold up if the right opportunity turned up tomorrow, uninvited.
Building to leave is what makes staying easier
None of this means you need to be planning your exit right now, or that wanting to run the business for another twenty years is the wrong answer. It means the version of the business that could be sold, merged or handed over well is also the version that runs better while you're still in it, less dependent on you, better documented, cleaner to look at. Building with the exit in mind, even when leaving isn't part of the plan, is largely what keeps the choice yours if the moment ever arrives, rather than something the business forces on you because there was never any other way through.
If the right buyer, partner or opportunity turned up tomorrow, would your business be ready to be looked at closely? And what would need to be true between now and then for the answer to be yes?
We build this out properly in Module 14 of Ready to Rise, including an exit strategy canvas that walks through what your own options could look like and what needs to change to keep them open. If you're not yet in the community, the link is here.
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