According to the US-based Exit Planning Institute, between 50-75% of founders and business owners experience regret post-exit. That might seem shocking, but anyone who has built and run a company will be aware of the complex emotions that it involves. Those feelings last long after a founder is no longer part of the business. On the one hand, assuming the exit goes well, it can be a reward for the years of sacrifice, long hours and risks that all founders take on as they start and grow a company. On the other, there is often a deep emotional bond with the business, as well as the complex feelings of identity inextricably linked to being a founder. When exiting doesn’t meet expectations, we’re emotional beings. No matter how much the decision to exit has been driven by the head, there is always going to be a lingering question from the heart: what if? That can easily turn into regret if life post-exit doesn’t meet expectations. But how grounded in reality are those expectations? A founder might think that after all their years of struggle, they want to sit on a beach once they sell up, but will the exit support that? Even if that’s the goal, what about more prosaic responsibilities?

First, it’s important to understand the range of options available. These include: Initial Public Offering (IPO) – floating the company on a stock exchange and selling shares to public investors. Perhaps the most complex of exits, as it involves increased regulatory scrutiny, which affects how the business is run. As such, an IPO is best suited to larger businesses that already have a significant degree of governance in place. Management buy-out (MBO) – the company’s existing management team buys out the owners, usually with the support of external financing. While this ensures continuity and can be a way of rewarding senior employees, it does require the buyers to have access to sufficient capital. Private equity sale – a PE firm takes a majority stake in the business, usually with the intention of exiting within the next few years after having grown and developed the business.

These are all legitimate reasons for selling, as are what we might consider more urgent situations: death, divorce, a significant health crisis. But whether a founder gets to dictate how they exit or not, and whatever their motivations, we often see founders with post-exit goals that are detached from the route they’re considering. Having big, ambitious goals is great, but the event that’s going to enable them – the exit – has to be the right one.