What are Exit Strategies?

Exit strategies are plans executed by business owners, investors, traders, or venture capitalists to
liquidate their position in a financial asset upon meeting certain criteria. An exit plan is how an
investor plans to get out of an investment.

When Are Exit Strategies Used?

An exit plan may be used to:
•Close down a non-profitable business
•Execute an investment or business venture when profit
objectives are met
•Close down a business in the event of a significant
change in market conditions
•Sell an investment or a company
•Sell an unsuccessful company to limit losses
•Reduce ownership in a company or give up control
Examples of Exit Plans
Examples of some of the most common exit strategies for investors or owners of various types of investments include:
1.In the years before exiting your company, increase your personal salary and pay bonuses to yourself. However, make
sure you are able to meet obligations. It is the easiest business exit plan to execute.
2.Upon retiring, sell all your shares to existing partners. You will get money from the sale of shares and be able to leave
the company.
3.Liquidate all your assets at market value. Use the revenue to pay off obligations and keep the rest.
4.Go through an initial public offering (IPO).
5.Merge with another business or be acquired.
6.Sell the company outright.
7.Pass on the business to a family member.