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The Harvesting and Exit Strategy of your Business

The Harvesting and Exit Strategy of your Business

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Page 1: The Harvesting and Exit Strategy of your Business

The Harvesting and Exit Strategy of your Business

Page 2: The Harvesting and Exit Strategy of your Business

Harvesting

What is harvesting? It is part of your business plan To show investors how they will earn their

investment in your business venture. It is an indicator of wealth creation

Page 3: The Harvesting and Exit Strategy of your Business

Harvesting

• Three ways:1. sell your business,

2. take it public (Initial Public Offering, IPO) or

3. merge it with another.

Page 4: The Harvesting and Exit Strategy of your Business

How to Value Your Business to Harvest it profitably

• Main methods to estimate the value of your business:

1) Market Value of Net Assets

2) Value of Future Earnings

3) Off Balance Sheet Valuations

4) Replacement Cost

Page 5: The Harvesting and Exit Strategy of your Business

Exit strategy

• Four paths:

1. Acquisition

2. Earn Out

3. Debt-Equity Exchange

4. Merge

Page 6: The Harvesting and Exit Strategy of your Business

Worst Case Scenario

Liquidation,

Closure,

Bankruptcy

Page 7: The Harvesting and Exit Strategy of your Business

Activity

• Develop and present scenarios for best case, worst case, and most like situations for your business concept