Did you plan your new business with an “exit strategy?” As much as you might love running your business, you must have an end-goal in the plan. At the very least, an exit strategy keeps you from turning your business into a glorified job – working from home, but with longer hours.
This article will help you decide what the best exit strategy is for your business. There are many different exit strategy options out there, and depending on the type of business you have, some options may be better than others.
Here are three of the most common exit strategies new entrepreneurs use:
Exit Strategy Option #1 – Running Your Business on Autopilot
“Manager-type” business owners like this option, which involves making your new business eventually run on autopilot. It runs and makes money while you sleep, and all you need to do is check in every now and then to make sure everything is running smoothly.
How do you make a business run on autopilot? Simple – by finding the right people to do your tasks for you. You hire the right people, train them well, and pay them well. A good goal to set is to have someone take the reins after 6 months of training them. If after 6 months they’re still coming to you for minor decisions, either you trained them wrongly, or you hired the wrong person.
This exit strategy option is particularly popular with network marketers and multi-level marketers. After working very hard for the first two years, they’ll have built a thriving network of hardworking marketers who basically do all the work for them – and they can then relax, enjoy their wealth, and focus on the next business opportunities to come their way.
Exit Strategy Option #2 – Sell the Business
On the other hand, “entrepreneur-type” business owners love this option, which is all about building a thriving business within the first few years… and then finding big companies who will acquire the business and take it off their hands.
There are big bucks to be made in building and selling businesses, but it takes a lot of business intelligence… as well as, of course, the will to let go of the business you loved, fed, and kept changed for the past several years.
The advantage of this exit strategy is that after you sell your first company, you can go ahead and work on your next great business idea.
Exit Strategy Option #3 – Multiply Your Business Success by Becoming an Investor
Whether you’re a “manager-type” or “entrepreneur-type” business owner, you definitely should consider becoming an investor. As your business(es) generate profits, you invest these profits in vehicles that generate passive income faster than the current inflation rate can eat up.
Such investment vehicles include real estate, the stock market, the equity market, other businesses, etc. The key is to generate enough passive income to replace the income you generate from being a business owner, so that even if you had to stop/sell your business(es), you’d still be able to retire comfortably and provide for your family’s needs.
Now, I’d like you to take another look at your personal business plan. Does it have an exit strategy yet? If not, study the three options I shared with you in this article, decide which ones would fit your overall strategy best, and make the necessary adjustments to fit them into the plan.
Good luck, and here’s to your long-term business success!
— Kevin J Donaldson (@KevinJDonaldson) September 23, 2014
About the Author
Kevin J. Donaldson is an entrepreneur, life & business coach, and bestselling author of 10 Secrets of the New Rich. His mastermind group, Real Wealth Solutions, Inc., pursues the advocacy of putting a thriving business in every American home. To learn how to put up your own sustainable business and help rescue the economy, join the Real Wealth movement now.