The summary of Exit Modelling
Planning an exit strategy for every positive and negative contingency has become an imperative part of Business Planning. Exit strategy can be defined as the plan that is executed by an investor, trader, venture capitalist or business owner so as to liquidate its position in financial asset or dispose of tangible business asset once pre-determined criteria has been met. If in a situation where business operations are no longer sustainable and an external capital infusion is no longer feasible to maintain operations, then termination of operations and liquidation of all assets is the best option.
The summary of Outcome Modelling
Businesses are dynamic and can have disordered results. Therefore, it is necessary to be prepared for possible outcomes in future. Implied risk in any business is always present due to uncertainty of future results. Purpose of financial or project management is to be prepared for every outcome that is due to current decisions or investments made for future. Therefore, risk management in any business scenario or financial expectation should be outcome-focused rather than being process-focused. Outcome Modelling estimation is done to ascertain the results with more advanced analysis than simple arithmetical averages and totals.
Purpose of Exit Strategy
- For exiting a non-performing investment.
- For closing a business that is not generating profits.
- For limiting losses.
- For legal reasons, such as estate planning, liability lawsuits or a divorce.
- For a simple reason that business owner/investor is retiring and wants cash out.
Importance of Exit Strategy
- It helps to reduce stake in the business.
- It improves the probabilities of success.
- It significantly increases the ultimate exit valuation.
- It is a pre-requisite to a financing strategy.
- It is a foundation for entire company plan.
Different Exit Strategies
Veristrat helps clients in successful exit of their business. Following are the different types of exit scenarios:-
- Merger and Acquisition
- Initial Public Offering (IPO)
- Management buyout
- Family succession
Selection of exit strategy depends on factors such as how much control the owner wants to retain in the business and whether the owner wants to run the company in the same way or is willing to change going forward as long as he receives a fair price for his ownership. Selection of Exit strategy also depends on factors like business type, business size and different level of liquidity.
How we support you?
- By identifying the appropriate exit plan for your business.
- By calculating the expected value you can receive based on your exit plan.
- By identifying the exit options that are most aligned with your goals.
- By identifying the outcomes in particular exit scenarios.
- By helping companies in determining a condition that will trigger an exit and the conditions that will preclude an exit.
Our in-house experts provide surpassing guidance and advice on Exit and Outcome Modelling. We as a team try to assure that the client has a good idea of outcomes or results in advance based on their decisions. We provide detailed analysis relating to different scenarios involved in Exit and Outcome Modelling.