Celebrate Small Business Week With A Long-Term Plan To Build Value

Small Business Week celebrates entrepreneurship. It’s also the perfect time to seriously consider a business exit strategy.

I realize that might seem strange at first. When business communities around us are firing on all cylinders and when the best days of your work seem to be ahead of you… why would you think about walking away?

The sobering truth is that every business owner will eventually need to let go of what they have built. Personal desires can change, the market can shift, or the unavoidable facts of aging or health concerns can force your hand, whether or not you want to exit. Is it fun to think about? No. But many business owners delay strategic exit planning until the eleventh hour, forcing a scramble that could compromise their legacy - to say nothing of their own financial health, and that of the family and employees who count on them.

Sooner or later, business leaders realize they need to take exit planning seriously. The “a-ha” moment might come when a strategic acquisition falls through and a deal partner points out a lack of readiness for succession and long-term sustainability. For others, a partner’s illness or other personal events might show their business is more fragile than they realized.

Taking the first step

It might feel like a dash of cold water when you realize you need to create an exit strategy. But that doesn’t mean it’s a decision you should make out of fear. Exit planning can be a positive, affirming process.

Stephen Covey liked to say, “Begin with the end in mind.” I think this holds true for business exit strategies as well. How would you like to pass on your business? What would your peers, employees, and loved ones need in order to thrive? What would it look like to build a business that grows and endures long enough for you to take the next step in your own life journey?

Your exit is more than a final sale. It encompasses all the steps you need to take to build a business that operates as well as it can, with a clear direction for the future. Even if you don’t see yourself exiting your business for years or decades, an exit strategy gives you clarity that will add value to your work today.

If it still feels overwhelming, or you don’t know where to begin… I get it. An exit strategy is not a casual thing to plan. I’ve found that it really helps people to start with a smaller contingency plan for their business. Think of it as the business equivalent of writing a will. What would your business do if you couldn’t work or a mission-critical piece of equipment stopped working? How would you ensure the continuity of your business in the event of a natural disaster?

A contingency plan mitigates risks and protects the current value of your work. It is also a great starting point for future decisions. When you’re ready to chart a more complete business exit strategy, you’ll have a strong foundation to work from.