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Exit Strategy
A plan for withdrawing from a market if conditions become unfavorable, ensuring that the company can minimize losses and reallocate resources effectively.
Implications
A planned approach to exiting a business or investment, often involving selling the company, merging, closing operations, or taking the company public, essential for maximizing value and minimizing risks.
Example
Example: A startup founder develops an exit strategy that includes selling the company to a larger competitor once it reaches a certain valuation, ensuring a profitable and smooth transition.
Related Terms
Different from business continuity planning, which focuses on sustaining operations, an exit strategy is about planning the end or transition of ownership and control of a business.
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