Too Soon? When is the Right Time to Start Exit Planning?

It’s a strange sensation. Over the holiday season this year a thought breached the surface of your conscious mind for the first time. As you dwelled on this thought at holiday meals, while hanging out with family, and watching a few football games, you came to realize it had been lurking beneath the surface for years. It’s time to let it bubble to the surface.

The thought is that you’re human and that this will not go on forever. As an entrepreneur, you successfully ignored this thought for decades. You’ve spent your career engrossed in the present. You’ve spent your time solving today’s problems. Even now, you cannot take a 30-minute meeting without receiving at least a few calls from needy customers and befuddled employees.

Reality cannot be denied any longer. There’s a thrill that comes from being so indispensable and in the flow of the day-to-day, but it’s time to start thinking about your next act before it’s too late.

If this sounds like you, do you think you’re too early, too late, or just right for starting your exit planning journey? Since the most common objectives come from the “too early” camp, let’s discuss those points further here.

Just Wait to Worry About Exit Planning Until You’re Ready to Sell?

This common refrain misses the point of exit planning. Good exit planning is not an exercise in “dressing up your company” or “putting lipstick on a pig”. It’s much deeper. Similar to agriculture (something most of us know nothing about), the best exit planning takes time and the accumulation of many small actions over a sustained period of time to bear its fruit.

Consider Remaining a Shareholder With A Seat At The Table.

Exit planning is about improving your business in fundamental ways, such that its value increases substantially (preferably exponentially). Well executed exit planning affords you options you never had. Yes, it increases your chances of selling on your timeline on your desired terms. But, it also can provide you with menu selections previously unavailable, such as the ability (in some cases) to remain a shareholder by addressing stressors that might lead you to exit prematurely.

Don’t Waste Time Thinking About Your Next Act Until You’re Ready to Sell?

This objection to starting the exit planning process plagues many business owners. If your identity and life purpose is indistinguishable from your business, you should not delay in starting to address this now. The vast majority of business owners profoundly regret selling their business 12 months post-sale, and the main reason is not money, but purpose.

Thinking this through and exploring new hobbies and interests can be a very healthy way to start developing a next act plan for when you do eventually exit. It can also inform the ultimate exit option that is most suitable for you.

When it comes to exit planning, the reality is simple: you can never start too early and it's never too late to give it a try.

It may sound self-serving, but it’s always a good time to start exit planning. Put simply the sooner you start, the higher the value you will get from applying these principles.

From the Doescher Group perspective, the best place to start is with an Exit Audit. Get a baseline assessment of your business’s value and executable insights into what can be done about it. Little-by-little, deficiencies can be addressed and you will find yourself sleeping much more restfully as a result.

Be different. Have the courage to engage in exit planning earlier. Reach out to Doescher Group for help.