Think of decisions like a change of position, and no one thinks of positioning better than investors. So why not borrow some of their exit strategies for businesses to implement in your decision-making strategies?
Here are 5 exit strategies for businesses to use in small and big life decisions.
Merger & Acquisition (M&A) exit strategy
This usually means similar companies joining forces or a smaller company getting acquired by a larger company. The new position in the new company saves resources, diversifies skills, adds revenue, and should grow the company and makes it more efficient.
In non-business situations, you can use this idea. Say you finished your freshman year, and you need to get out of the dorm and find a new place to rent. You can’t afford to rent on your own, so you might decide to move with your friends, share the rent, or offer to cook for your roommates in exchange for a discounted rate. That’s a win-win situation.
Cash cow exit strategy
If you are in a stable market, you may choose someone to run the business for you for a fee while enjoying a steady income as you still own the business. Outside of business, you can let someone drive your car for a company like “Uber,” and you split the revenue together or rent a room out via Airbnb.
Sell to an individual exit strategy
This is a way to cash out, get some time for yourself or your family, or start a new business. A buyer who is interested in your business comes in and takes over management.
Think of this like freelancing, if you can afford to do it. Hire a secretary to answer your phones and respond to your emails. If you are a writer, get a research assistant. It might be as small as getting a babysitter for Friday night so you can go out with your wife.
Initial Public Offering (IPO) exit strategy
This is one of the juiciest exit strategies. One day, you might turn into a billionaire; however, it comes with shareholders’ demands and liability concerns.
Think of this as owning an apartment that you use to run your business with three rooms. You can rent one room for any other start-up in your area, where you are the main shareholder.
Liquidation and Shutdown exit strategy
There are times when you have to close your business altogether. They are challenging times but inevitable. The more complex part is predicting the fall. Think of market bubbles like in the early 2000s, the internet bubble, or the mortgage bubble in 2008.
For example, you can decide to emigrate to another country if you expect political or economic turmoil. Or you may choose to move to a safer city when wildfires happen because of the summer drought.
Having an exit strategy will always be handy when you have doubts after implementing a decision.
Conclusion
Exit strategies for businesses may be used in your small and big decisions. Having an exit strategy will keep your options open.
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