Do you have an exit strategy for your business? What if we told you it only takes 6 years from starting it for you to be done and dusted? According to the Growth Guru Nic Rixon, you should start with this end in mind. For Nic, it’s as simple as Valuation = Profit x Depends! How much a business is valued at depends on a range of factors, yet stock price must be accurately calculated with a multiple. Even so, businesses can sell for above or below their industry’s benchmark value, so what is skewing these prices? The management team’s consensus on the valuation, developments in the industry (is it growing? In decline?), regulations that could cause tectonic shifts. If your management team is unable to deliver the future valuation, then a discount will ensue. Now is the time to think about an exit strategy; the time to use it is closer than you think.
Posted by Accountants' Club at 2022-04-20 10:35:08 UTC