1 Simple Rule: If You Want to End Your Entrepreneurial Journey, Consider Multiple Possibilities

Consider potential exit routes early in your venture’s life.

Every entrepreneur has to exit their venture one day (unless you want to “die in the saddle”). However, not every venture fits every exit route. If you try to take your company public one day, you must set up a venture that can grow enough to be eligible for stock market listings. If you want to keep the venture alive after exit to offer your employees a future in the firm, develop a strategic fit for a potential buyer. If you want to leave the firm to your offspring, employ them beforehand to familiarize them with the firm and gain employee support. Thus, your options for exiting the venture are influenced by the decisions you make earlier in the venture’s life.

Don’t underestimate the emotional costs of an exit.

Although your exit may be voluntary, substantial emotions are likely associated with leaving the firm. Some entrepreneurs compare this process with a kid leaving the house. After the exit, you may feel that something important is missing in your life. Anticipate these emotions to be better able to “let go.” Your partner or loved ones can be an essential source of support in this process. Try to consider how you want to spend your time after the exit. Engage in outside activities before the exit for inspiration.

Plan your venture exit and your exit flexibly.

Planning your exit is difficult and can be time-consuming. In addition, some factors influencing your exit options, such as economic developments, are out of your control. Therefore, plan your exit some time ahead and account for potential contingencies. Consider the possibility that a potential buyer for your venture may require you to continue working for the venture for some time to share your knowledge. Conversely, if you believe your venture has great economic potential, you may retain a stake even after ceasing your operational involvement.

Consider starting again.

After exiting their ventures, many entrepreneurs want to feel the excitement of starting up again. Given all your experiences from the exit, you are uniquely positioned to “do it again.” Not only have you acquired essential knowledge, but you may also have unique networks and financial means for making a new startup successful.

2 Simple Rule: To Keep Your Venture Alive After Exit, Manage the Succession Process Right

Select the proper successor.

You may find potential successors for you inside or outside the firm. Don’t look for a copy of yourself; you are unlikely to find one. Instead, look for someone with the right skills based on their resume and who is highly motivated to make the firm successful. Internal candidates have the advantage of knowing your firm, but external candidates bring new ideas that may take the firm to the next level. Decide on the right candidate based on your venture’s current and future perspectives.

Plan the succession process strategically.

Founder succession is not a one-time event but a complex process that can take years. Plan the process. The more you involve your successor early in succession planning, the more likely they will accept the plan and work jointly with you on its execution for a smooth transition.

Develop your successor.

Your successor needs time to learn from you and understand your business’s operations, culture, and identity and your role as a leader. Help your successor take over this role. This help can include developing your successor’s technical and business skills and providing mentoring and emotional support. Recognize the successor’s education and achievements. Trust in their abilities and let them make mistakes. Mentor them and provide them unconditional support without expecting returns.

Use advisors to manage the emotions of the succession process.

The succession process is emotional and stressful for both you, the exiting entrepreneur, and your successor. Advisors can help unearth and alleviate these emotions. They can also mitigate conflict that generates undesired emotions. By understanding your successor’s emotions, you can better assist them in taking over your role. This understanding will make the succession process smoother and more successful.

Let the successor do their job.

Since nobody knows a venture as well as the founder, you may think you are indispensable to your firm. However, interfering with your successor makes it difficult for them to realize their ideas and gain other venture members’ respect. Be approachable for the successor’s requests for advice, but avoid their decision-making and management. Otherwise, you jeopardize the firm’s success perspective—the opposite of what you tried to achieve when selecting and installing the successor in the first place.