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The One Secret Ingredient For a Successful Exit

By John Carvalho
Published: January 15, 2021 | Last updated: March 21, 2024
Key Takeaways

The only way to ensure a successful exit from your business is by learning as much as you can before launching the process.

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The word “exit” can take on so many different forms for business owners. It can mean selling your business entirely to a strategic buyer. Or it can mean taking on a private equity partner with only a partial sale of your business.

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An “exit” also covers owners throughout the entire business life cycle. The concept is definitely relevant for the owner that is tired and wants to move on to the next phase of life. It is equally relevant for owners that are still motivated to find investors to fuel the next stage of growth.

For me the word “exit” does not adequately encapsulate the multitude of combinations that are possible for the event of selling all or part of a company. But through all of the possible scenarios, the one key ingredient for a successful exit remains true.

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What is This Secret Key Ingredient?

Knowledge. It probably sounds obvious and disparaging, so it's easy to dismiss knowledge as the key secret ingredient. Business owners have 75%-95% of their net worth tied up in their businesses, yet 70%-80% of businesses fail to transition to a successor owner—even though so much is riding on the outcome.

Increased knowledge of the execution of an exit will undoubtedly change this narrative for you.

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Divestopedia Masterclass: Selling Your Midsized Business

For that reason, we have assembled four internationally recognized M&A investment banking pros to bring business owners knowledge on the execution of an exit.

These professionals provide unbiased and unfiltered advice on the process; a view that so many business owners that have gone through the process say would have been extremely beneficial.

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The virtual masterclass dives deep into the following topics:

  • Selecting the M&A Advisory Team
  • Strategic Positioning and Preparation
  • Valuation
  • Marketing the Deal
  • Letters of Intent
  • Competitive Auction Process
  • Negotiations
  • Due Diligence/ Management Presentation
  • Definitive Agreement
  • Deal Obstacles

For those business owners that are serious about successfully exiting their business, this masterclass is an absolute must to gain the secret ingredient of knowledge on this topic.

Get a jump on your learning with some of the other resources available to you on Divestopedia:

Selling Your Business: What Sales Process is Best?

There are many ways to sell a business, but only one will be the best for you. Consider these three options and figure out which one will get you the top dollar you deserve.

The Value of A Valuation

Learn what makes up a good valuation and start the process before it's too late.

Investors' Decision-Making Process & Why You Should Know it Before Going to Market

To maximize price, you need to know what the investor is really looking for. Requirements vary widely from investor to investor, so learn to ask the right questions and what numbers really matter.

Surprises to Watch Out for When Selling a Business

Here are some issues you may face when it's time to sell your company. Prepare yourself and don't make these mistakes!

6 Things to Consider for Your Post-Divestment Life

Transitioning out of your business is difficult. Decide now what kind of life you want next.

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Written by John Carvalho | President, Divestopedia Inc.

John Carvalho

John is president and founder of Stone Oak Capital Inc., an M&A advisory firm, as well as a co-founder of Divestopedia. For more than 20 years, John has served his clients on numerous valuation, acquisition and divestiture assignments in a wide variety of industries. John holds the Corporate Finance designation, is a Chartered Business Valuator and a Chartered Accountant. He has made it his life's mission to help entrepreneurs build valuable businesses and Divestopedia serves as an avenue for this cause.

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