6 Reasons to Have the Exit Conversation with Those Around You
Your business’ future is important, so why wait to take steps to prepare for the time when you will have to step away from your business? It can be an uncomfortable subject, but the most important part of this process is to have some sort of strategy. Having a plan when it comes to an exit strategy for your business is better than no plan at all, but getting an idea of what you want in the future is a great start. Things like disability, death, or divorce could cause you to involuntarily leave your business, while a change of heart can cause you to voluntarily depart your business.
You want to be in the driver seat of this next stage of your business. Its important to start considering the many different reasons why as a business owner you should start to think about the future of your hard work by having a proper exit strategy. Here are a few reasons why having an exit conversation now can benefit you in the future.
Anything Can Happen
This reason is first on the list because it is the absolute truth. Although things can look good now, there is no telling what will happen in the future. You never know what might be the reason for stepping away from your business.
There is no need to jeopardize the legacy of your business and all of the work you put into building its legacy. Leaving the fate of your business up to uncontrollable and random factors is not something that will work out in the long run. Although having an exit conversation can be unsettling and easy to forget about, you are better safe than sorry.
Family, Friends, and Health
Your personal well being can be an important factor in the dynamic of your business. Many business owners also have families, which can be a source of stress when both the business and the family ask for large time commitments. A negative turn in personal health or family obligations are both situations where you have to involuntarily leave your business.
If your business is not able to be run without your day to day supervision, more often than not, family, friends and personal health obligations that take a business owner out of the office serve as a proxy for having the exit conversation.
The point of this section is to show that you do not have to give up on your business just because an important family matter can hinder the businesses overall growth. Having an exit conversation can lead to positive outcomes that still allow you to play a pivotal role in your organization while still being able to be committed to your family, friends, and most importantly, yourself. An exit conversation will possibly lead to adding a partner or key senior team member to your business’ team. Someone who can pick up some of the load when you are tied up with family obligations and will give a smoother transition if you decide that you do want to fully exit the business in the future.
You currently Do Not Have a Plan
The uncertainty of future events, whether the events be in your personal life or outside your inner circle, is a crucial reason why having an exit plan is important. Although you might be doing a fantastic job running your business, which you probably are, what could happen if you were forced to leave your business? Do you have someone who can take over your responsibilities? Specifically, do you have someone who you feel is qualified enough to take on the responsibilities of running your business?
These are all questions that, although are hard to answer, must be answered to ensure that you have a smooth transition period and that your business is set up to keep succeeding once you have left the business.
If you are experiencing burnout, you probably have thought about how long it will take until the amount of work it takes to run your business is just too much. You might have pondered what else you could be doing instead of slaving away to keep your business afloat and growing. You could be spending more time with family, enjoying hobbies, or traveling. If you are experiencing burnout, the first thing to do is reevaluate what is truly important to you and estimate how much time you are willing to spend working.
If after some soul searching you come to the conclusion that you want to spend less time working and more time doing other things. To take a lesser role in your business, you are going to have to give some thought to how much responsibility you are looking to give up in a possible future exit.
If you find that you are being overworked because you have too much responsibility to the point where it is not helping the business grow, a conversation about your exit strategy and the steps to combat the burnout becomes more and more necessary.
Struggling to Grow
You suddenly found that although your business has grown so far since it first started, you are struggling growing it past where it is currently. Having an exit conversation can bring in a strategic partner, who ideally has the ability to grow your business if pushing past a plateau is beginning to become a struggle. They will be able to use their prior experience to bring in an articulated plan to help grow your business past where it once was.
This is the point of your life that will benefit the most from having an early conversation about a future exit strategy. Say you find that being a business owner is becoming a bigger time commitment later in life as you want to spend more time enjoying other things in your life besides your business. As you ponder retirement and the excitement it has to offer, you realize that you don’t have any idea of a plan to leave your business. If you wait to plan a proper business exit strategy, it can be hard to find the best strategy and will likely take more time and stress.
So when are you going to start having the exit strategy conversation? Put in the necessary pieces where you are no longer the essential component of the business’ success?. At the very least, having just a conversation to explore the different options that are available will get the ball rolling.
We want to be that resource. Tsetserra Growth Partners provide free tools to aid you through this conversation, making it as easy as possible. One of these tools is our market valuation of your business. Knowing what your business could be worth will make the exit options much clearer. To find additional resources and guidance about the process of selling your small business, click here to learn more.