Answer: The "Exit Strategy" topic is an important part of every business
plan. It benefts everybody involved in the business.
- Owners (and their families)
- Investors
- Employees
- Families
It is shown that contingency plans are in place for a number of different
disasters and a plan is also in place for how and when the business will
evolve.
"Does it make sense to put in the exit strategy as Yahoo!(or some company)
will probably buy us out in two years?"
Yes, Acquisition is a very valid exit strategy. But there are other exit
strategies to discuss, some more comfortable than others.
· What if one of the key partners dies?
·
What if a key partner wants out?
· What if the acquisition strategy doesn't work out?
· What if the market for the key product dies?
· What if the necessary financing falls through?
Covering questions like these and others in the business plan makes everybody,
including investors and bankers, feel more comfortable with the business
plan and the people behind the business. It shows that you've thought
these things through and that you're not operating in a fantasy land called
"it won't happen to us".
