You might already know precisely how you plan to exit your business…
And it’s one of the most common questions I get asked: which exit route is best for me and my business?
The short answer is – it depends on the business you have and what you’re looking to achieve:
🟪 EOT. Employee Ownership Trusts mean you can sell your shares to an employee-owned trust, with no direct share ownership by employees. It does have tax advantages, but the process can be lengthy.
⬛ MBO. A strong leadership team can deliver you a management buyout. Traditional lenders are less helpful these days, but there are creative funding options if you know where to look 🙂
🟦 TRADE SALE. Buyers who understand your value and are motivated to acquire your business for strategic reasons, will often pay a premium. But there are risks in sharing your IP and financial data, during negotiations.
🟫 PUBLIC. Sometimes pursued for a ‘valuation bump’ on specific exchanges, but there’s a big difference in cost, complexity and outcome, between a direct listing and reversing into an existing PLC.
⬜ PRIVATE EQUITY. You might want to stick around for the next growth phase and derisk your position at the same time, by taking some money off the table. Securing the right PE partner is critical.
Final thought: finding the right partner to support your scale-up and exit plans is just as important as finding the right acquirer for your business.
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