I’ve spent years advising businesses on growth and exit strategies, and for many established firms it can difficult to groom management out of thinking about what’s best for them, instead of what’s appealing to a potential new owner.
Of course, if you’re a start-up or early-stage, you’ve got the opportunity to design an exit-friendly model from the outset. The sorts of features which make a business easy to buy can be built-in from day one, and starting with the end in mind is a really smart way to ensure future wealth.
For example, I know ventures that have been founded deliberately to antagonise a competitor, provoking them with loss-leaders or guerilla marketing to make an offer to “take them out”. Less aggressive, yet equally effective strategies can include:
- Become an essential supplier to a bigger firm. They may worry about what would happen if you ceased trading, and buy you out to secure their own future
- Offer complimentary products/services to those of your target purchaser, and approach them to discuss a “joint venture”. These can often mature to full-blown takeovers
- Choose a niche which is relatively un-crowded, so your presence is easily visible to potential competitors and suitors
- Build your business around a handful of products (maybe only one!) which you can supply cheaper/better/quicker than your competitors
Even if you’ve been around for a while, and haven’t really thought about your exit strategy before, it’s never too late to groom the venture to attract your dream buyer.
Jonny Cooper is a business growth coach and exit strategist, having sold numerous businesses including his own £10M financial firm.
Follow Jonny on Twitter @jonnycooper
For a free Half-Hour of Power Skype Session with Jonny, email Jonny Cooper here.