Every startup is a dream come true. Initially even though everything looks very successful and green, every entrepreneur definitely needs to have a backup plan. Just as you needed a plan to get into a business, you’ll need a plan to get out of it and it needs to be a successful one. While the reasons to exit your dream startup may be many, the three basic criteria that an entrepreneur considers once the exit stage has been spoken about are selling, merging and closing.
Now that the entrepreneur has decided on whether to sell, merge or close his business for good, what could possibly be the reasons behind this? If the person is unable to handle the company as a single man or has no heir to take over, then an exit is the only option. Another common reason could be when there is a friction between two partners and one of them decides to dissolve their partnership and walk out. While the above two happens in most cases, the third complication that is witnessed in a lot of young startups is the lack of resources and monetary support that leads to shutting down the business.
After the entrepreneur has finally announced of his exit, there are a couple of things he needs to do before he walks away. While terminating insider deals is one of the important aspects to look into, he also needs to make sure his balance sheet is all cleared, taxes are paid and he has a backup of at least two years’ worth audited financial statements.
Plan your exit strategically and successfully with Mentor Muthu’s guide below!