To be or not to be: A Startup Exit Tale
In the era of startup boom, India has emerged as one of the fastest growing economies as well as a major startup hub across the globe. To add more to the pride, India ranks at no.3 for its successful tech startup exits that entail 86 M&As (mergers and acquisitions) and 2 IPOs trailing economy giants U.S. and UK. The support from the prime minister and foreign investors has been a great boost to the Indian startup ecosystem, and if not for the economic growth, the exit ROI is among the major criteria for investors to shell out the fat checks.
However, another side of this startup story has been the number of exits and shutdowns that we have been seeing. From AskMe Bazaar to TinyOwl, the startup bubble seems to be vile for a few one owing to burgeoning competition, plumbing sales and lack of funds.
If you are spearheading a startup and find yourself in a rut when it comes to determining all the “whens” and “hows” of a successful exit, then here is a guide for you.
So what is a startup exit?
As simple it sounds, a startup exit refers to the investors or venture capitalists withdrawing their stakes from the venture, which may be followed by:
Merging and Acquisition (M&A): The budding venture can be merged or acquired by bigger enterprises in return of a negotiated capital.
IPO (Initial Public Offering): The venture capitalist can sell the start-up’s shares to the public gaining a substantial amount of capital from them (but usually takes more time).
Having known that, let us see how an investor can have a smooth and successful exit.
The success of a startup is indicative of successful exits, however the same can be vice versa: a successful exit needs a successful venture i.e. your startup must have a good growth rate or should be profitable enough to bring in potential buyers.
The same can be achieved by:
- Planning: Planning is the key, so if you know the answer to the question,” Where do you see yourself in the next 5 years? Be it riding high on a well-grown business empire or working up on a new project or under the worst case being engulfed by rising rivalry (well, not this one for sure) plan your way through it. As a well-planned venture always triumphs over a shabby startup.
- Developing: As a startup that starts right from the scratch, it is immensely important that you be keen on developing your products, processes and staff. A better product enhances your sales while better processes and staff improves your efficiency, acting as a quick bait for the big sharks and the stock market.
- Toping Service/USP: A smoothly growing business with a unique product or selling point or even a top-notch service are a good way to attract investors to acquire your startup.
Now, when is the right time to call in an exit?
Apparently, there is no right time for a venturist to get on his way with the invested capital. You may enjoy the perks of being a founder of an amazing startup, until someday you are brought upon the deal of your dreams (or needs) while you clear of the co investors, employees, and other financial benefiters etc.
How can Sage Software Solution help?
Sage ERP solutions are modern-day business management tools that can help you plan, schedule and calculate your business processes to ensure seamless business growth. Its intuitive modules let you manage and strengthen the essential pillars of a startup making it efficient and unerring to the core.
Sage CRM software: Sage CRM is a partly cloud based CRM solution that help you manage your customers better, enhances sales pipeline and ensures better conversion rate. Furthermore, Sage CRM can assist in a smoother M&A of your startup by providing unerring data merging with the new parent firm.
Buckle up as you drive your startup towards a successful exit. To know more about a smooth startup exit, contact us here. You can also SMS SAGE to 56767 or drop us a mail at email@example.com for a free demo and consultation.
Originally published at www.sagesoftware.co.in.