Exit Planning Step 1 - The Launch Plan
Most entrepreneurs start a new company with a business plan that lays out their vision, goals and how they will execute on them. When it is time to sell your business, you should have the same type of plan in order to meet all of your goals upon exit—you need an exit planning strategy.
What is an Exit Planning Strategy?
As defined by Richard Jackim, CoFounder of the Exit Planning Institute,
• An exit plan strategy asks and answers all the business, personal, financial, legal and tax questions involved in transitioning a privately owned business.
• It includes contingencies for illness, burnout, divorce, or death.
• Its purpose is to maximize the value of the business at the time of exit, minimize taxes, and ensure the owner is able to accomplish all his or her personal and financial goals in the process.
Exit planning is simply good business strategy.
If you are considering selling your business in the next several years, you should be asking and answering a lot of questions NOW to ensure the best possible outcome. Erin can you help do that.
STEP 1 IN EXIT PLANNING IS HAVING A LAUNCH PLAN: This includes a business, personal and financial assessment performed in conjunction with a business valuation.
In creating your Launch Plan, Erin will assess your:
*Business Attractiveness – how a 3rd party will perceive your business.
*Exit Readiness – evaluate your business’ tangible and intangible attributes that drive company value and higher multiples.
*Financial Readiness – determine how comprehensive your current personal financial plan is, confirm your net proceed expectations from your future business sale, learn if your proceed expectations are aligned with your spending needs, evaluate steps you have taken to help minimization taxes after a sale, ensure your current estate plan is up-to-date, etc.
*Personal Readiness – determine if you are clear about when you want to exit your business and why, find out if you are willing to stay on for a period of time after an acquisition and why that may be critical, discuss your personal plans post-sale and why having detailed objectives for your next phase is important.
*Business Valuation – your current financial statements will be recast to determine the adjusted EBIDTA calculation used in valuations, and to determine your business’ current range of value.
Upon completing these assessments you will receive a Prioritized Action Plan detailing the business, financial and personal actions needed in order to plan a successful business exit.
We also identify where your business compares to Best in Class companies in the industry, and identify action items you can take to protect, build and harvest your business value.