Create 2 or 3 exit plan that would be potentially available for tech company.
consider financial interest at the point of exit and how much money if any you plan to take it. Based on your exit plan decide whether you will exit by closing or transfer or selling.
In two to three bullets explain your rational for choosing this strategy.
Describe which condition might cause you to make changes to your exit strategy.
What would happen if your business became unprofitable, for example
Exit Plan 1: IPO
- An initial public offering (IPO) of the tech company's stock, allowing the founders and investors to cash out their initial investment
- The rational for choosing this strategy is to maximize the financial gain for all parties involved and provide liquidity for investors
- Changing economic conditions, market volatility, or regulatory changes could potentially impact the timing or feasibility of an IPO
Exit Plan 2: Acquisition
- Selling the tech company to a larger corporation or competitor for a significant profit
- The rational for choosing this strategy is to ensure a smooth transition for employees and maintain the company's innovation under new ownership
- The inability to find a suitable buyer or a decrease in the company's valuation could necessitate a change in the exit strategy
Exit Plan 3: Management Buyout
- Allowing the current management team to buy out the founders and investors, providing them with ownership and control of the company
- The rational for choosing this strategy is to provide continuity in leadership and reward the management team for their hard work
- A lack of funding or interest from the management team could lead to the need for an alternative exit plan
If the tech company became unprofitable, the founders and investors may need to consider closing the business or seeking a merger or acquisition to salvage some value from the company. In such a scenario, it may be necessary to pivot the business model or seek external funding to turn the company around before considering an exit.