What's your exit strategy -- other than kicking the bucket?

The day you start your business is also the day you should be planning how you'll exit your business. That's because how you lay your biz's foundation depends on what you're going to be doing with it in one year, five years, ten years or more from now.

So, step 1 is to ask yourself -- what's your exit strategy? Typical examples include:

1. Sell the whole business to someone else. Could be a stranger, could be an existing partner who has a part interest in it.

2. Sell parts of the business (e.g., liquidate the main assets).

3. Have a family member take over the business. (Make sure they're actually interested in doing this.)

4. You work until you die or become otherwise incapacitated and unable to work any more.

5. Just close the doors on the business one day.

6. Let the business die its own slow death.




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OK, now here's why all of this is important. As you build your business, you need to consider these factors and how they relate to your exit strategy...

1. Branding.

If you're branding the business around your name and likeness, your brand won't be as valuable when you're no longer part of the business. Consider this issue if you intend to sell or give away your business to someone else.



2. Scripts, tools and accounts.

Are you purchasing or using free scripts and tools for your site? If so, make a note of which of these scripts can easily be transferred, and which ones require the new owner to buy their own license. Doing so saves time and keeps things legal.

Here are some of the tools and accounts to consider: Mailing list managers, payment processors, forum scripts, social media scripts, classified scripts, blogging scripts, blogging themes and plugins, Squidoo pages and accounts, Twitter accounts, YouTube accounts, article directory accounts, etc.

Also, look at some of your other assets, like PLR content or the photos you've purchased at places like istockphoto.com. If you sell the site, can you transfer these assets? Check your license to be sure.

In short, look at both the self-hosted as well as third party tools, services and resources you use. Find out upfront if you can transfer them to someone else.



3. Mailing lists.

Are your currently promising your newsletter subscribers and customers that you'll never sell, giveaway or otherwise share their info? Then you can't sell your mailing lists if you sell your site.

If you suspect some day you might want to sell or giveaway your business -- mailing lists and all -- then your TOS needs to reflect the fact that you may sell your customer'/subscribers' info.



4. Your own email accounts.

Are you using your domain's email addresses for personal use? Just remember that if you ever intend to sell this domain to someone else, you'll first need to change your email address to something not linked to the account.

This doesn't create a hardship for your buyer (as they can just blackhole any accounts you were using), but it DOES create an extra hassle for you since you'll need to stop using that email if you sell the domain.

Some of the places you may have used your email accounts include: Payment processors (like PP or CB) article directories, social media sites, forums, newsletters and everything else. This doesn't even include personal uses such as online banking, personal correspondence, etc.



5. Does someone else know how to run your business?

You could have an accident, personal crisis or health issue that takes you away from your business temporarily. Or you could just kick the bucket. In either case, perhaps you want your friends and family to take over. Here are issues to consider:

a. Do you have passive income streams of income set up so that there is some money coming in while your family figures out what to do?

b. Have you written down ALL your passwords and usernames for important accounts like PP, your bank accounts, your websites, blogs, AdWords, social media sites, FTP, etc?

c. Have you created exact instructions for your family to follow so they know what to do to keep the money coming? Preferably, it's helpful if you also train someone personally as well as provide instructions.

d. Have you given instructions to your family about who to notify in case you're very ill or you die? For example: your business partners, your freelancers, your clients, maybe people on this forum (or any forum where people know you).

e. Is anyone even interested in taking over?


Which leads us to our next issue...



6. Can your business even run without you?

If you sell your business, get sick or even die -- can someone else take over easily? For example, if you sell your business, will the new owner be able to continue generating an income? Or does the income dry up the moment you leave the business?

Point is, you should spend time developing business models that allow others to take over if need be.



7. Do your freelancers work as a team?

Some people have a "team" of freelancers, but they all work completely independently, with the business owner serving as the project manager. Now if you're the project manager, then your outsourced projects will come to a screeching halt if you're unable to work with them.

You might consider hiring a project manager who can keep things going if you can't. Also, you may want to create processes, procedures and mindmaps for your team to help connect them (so they work like a team) as well as to help them perform their tasks even in your absence.




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These are just a few issues to consider when planning anything from a simple website to your overall business strategy.

But the above list is just a start -- what else should we add to this list?

Cheers,
Becky