For many entrepreneurs, the exit plan involves selling the startup when it is good and ready. The problem you face is figuring out when that time has arrived. Here are five signs your exit plan is good to go:

1. You Know What the Company Is Worth

If your exit plan involves selling your startup, then you need to know exactly what it is worth. One of the first things you should do is to get your company appraised. You can’t just sit there and wait for a good bid. You need to set the selling price, and you need to set that price according to the market, rather than on what you feel it is worth.

2. The Startup Has a Solid Brand

Entities who buy companies aren’t looking for a fixer-upper. While they will make changes to your creation, they don’t want to feel like they have to change every single detail. If you want to sell your company for a great price, you’ll need a solid brand to go with it.

A solid brand does not just involve being well-known in your target market. It means that your website and your brick-and-mortar store (if you have one) is fully functional and requires little overhaul. This should also be true of your office. A startup with a well-equipped office where employees can be at their best is incredibly appealing to entities thinking of buying your business.

3.    The Startup’s Numbers Are Solid

It may hurt to hear, but your small business offering is rarely the reason someone would want to buy it. The main reason someone would be willing to put up money for your startup is because of the numbers. Potential buyers want to know the numbers behind the company, so you need to know for certain that those numbers are solid and attractive.

The startup’s present numbers aren’t the only ones you need to know. You also need realistic projections for common developments in the future. If you know these numbers, you can put up a more convincing argument for your asking selling price.

4.    It No Longer Requires Outside Investors

Most startups will require outside investors to scale up, and that’s OK. However, that’s not what buyers are looking for. Company buyers aren’t looking to purchase a company that needs help. They want a brand that can stand on its own two feet, one that they can fully own – and they can’t do that if the company needs outside investors.

A startup that cannot create enough revenue to support itself is simply not ready to be sold. However, if it can sustain itself, it’s not just ready to be sold, it can generate a bidding war.

5.    The Small Business’s Systems Work and Are Scalable

One of the main reasons companies are bought out is because much of the hard work is done. The product is proven, it has a consumer base, and importantly, its systems are in place and refined. These systems are what allow the company to function smoothly without micromanagement or constant handling.

These systems also allow your small business to run independent of any specific personnel. This makes it appealing to any buyers who want your company for what it is, not for who is in it.

Selling a small business can not be done without proper preparation and appraisal. This is your exit plan as an entrepreneur. Get it right, and you can make your future brighter.

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