How to Prepare for an M&A Exit

business acquisition deal money handshake

While many startups are excited about the prospects of developing a business, what’s just as important is considering how you will exit the company in the future. Most startups are acquired through mergers, and that is how members exit. Preparing for this moment will ensure that the business acquisition goes as smoothly as possible.

Establish Your Team

Exiting a business, primarily through a company merger, is an incredibly complex process. You should rely on quality team members that understand the complexities of your business. These individuals can help you organize and negotiate the terms of the sale as well as the exit.
Critical team members include:
Founders and Directors: These are the individuals who will focus more on the details of the transaction and ensure that everybody stays up-to-date on any developments throughout the process.
Employees: There are usually only very few employees involved in the exit of a company. However, they can provide valuable insight and assist with some of the development of valuable transaction documents.
Lawyers: Lawyers will help draft contracts and can assist with terms of negotiation.
Accountants: You want to be sure that you maintain tax law throughout the process and an accountant can help with each step.


There are many important factors when it comes to an exit. Even if you aren’t entirely ready for this step in your company, it’s always best to stay as organized as possible so that when the time comes, you can save yourself some time and unnecessary stress. Some areas of focus include:
Make sure all licenses and permits are current and properly filed.
Ensure that contracts are organized and duly signed and dated.
Maintain company records and that those records are thorough.
Conduct regular audits and financial reports.

Create a Roadmap

All businesses need an exit plan eventually. Although you may be years away from this decision, you can create a simple plan now, so you at least have a general idea of what you want long term. Considerations include:
Establish your end goal and what that means for shareholders.
Select a structure for the exit transaction.
Decide if you want a whole or partial exit strategy.
Consider stakeholders long-term goals of payment.
Determine if employees and management remain with the business after the exit.

Preparation for an M&A exit should be something at the forefront of an entrepreneurs mind even in the earliest stages of development. Even if you are years away from this decision, the more you develop an exit plan now, the easier the transition will be in the future.

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