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If you want to make a meaningful difference in the world but think that “exit planning” doesn’t apply to you, you’re wrong, and this series is for you.

In earlier posts, I challenged us to think of all our changemaking efforts as temporary. That if they endure, it is because they’ve had several lifetimes, not one. That the world loses when we put mission-focused organizations on life-support. On the analogy of your venture as a custom home, I illustrated why proactive exit planning is good planning. And I have delved into other reasons why exit planning may be the best investment you could make into the impact you target. Now, it is time to identify your exit options and build your exit strategy!

In creating your exit strategy, think of exit the way you might think of an investment property. What value would it have in the eyes of others you may want to take it over? Who would you like to own your venture after you? Can any number of “buyers” imagine themselves happy in your venture? What would they find valuable — or not so much? Are your planned modifications likely to increase or decrease your venture’s appeal to potential buyers?

NOTE: Changemakers’ Substack is for everybody within the growing global community committed to perfecting the craft of creating big bold change. I post (a) actionable guidance on what might snag your efforts to make a meaningful difference in the world (this post), (b) world-leading research and debate on changemaking, and (c) my reflections on a life of a professional changemaker. While not every post may resonate with you, stick with me, please!

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NOTE: As always with me, “venture” applies to any concerted effort to make a meaningful difference in the world, at any scale and whether governmental, for- or non-profit.

Perhaps because they are created much less frequently than business plans, there is substantial variability to exit strategies. However, they should answer some shared questions, which I have distilled to seven and introduce below.

The 7 questions to your exit strategy

Note that planning for exit will likely feel really personal. While you should answer all the questions sincerely, some of the answers need not show up in documents you create for external consumption.

Q1: Why are you planning for exit?

“Because you left me little choice, Elena,” is a fair retort at this point in the series.

That said, try to go deeper into your particular reasons. What do you need exit to do for you? Do you need to protect your government venture against political volatility? Is exit a condition of accepted investment? Are your retirement savings locked in your venture? Are you ready to do something different? Is burnout showing its ugly face?

If you are considering exit while still shaping your venture, the questions would query what you need your venture to do for you:

* Enable you to hand over to a more capable operative

* Allow you to work fewer hours

* Provide a steady paycheck

* Afford a certain lifestyle, perhaps in a particular location

* Confer a higher social status

* Set you up for your next career

* Propel you into certain political or professional circles

* Generate the nest egg for an (early) retirement

Q2: What is your preferred exit?

Exit refers to getting out of your venture.

Identify and assess all your options, ranking them from the standpoint of their desirability for you. The most common options are:

* Having somebody take over

* Liquidate and dissolve

* Go independent or IPO

* Staff buy-out

Let’s consider these one by one.

Exit option #1: Have somebody take over

For a commercial or nonprofit venture, an acquisition can yield the most cash for you. At a minimum, the buyer would take on your venture’s liabilities, such as debts. While “acquisition” is not the term most likely used for government ventures, its essence remains: another party is willing to take responsibility for your program’s performance and to fund it out of their budget.

What might this option look like?

* M&A. Your venture merges with or is altogether absorbed by a complementary one under a shared brand. The term “M&A” (mergers and acquisitions) describes this for commercial and nonprofit ventures, with mergers retaining (at least for a time) distinct identities while acquisitions lose theirs. The founder payout may be stretched over years and even tied to the venture’s ongoing performance under their leadership (aka “golden handcuffs”) for several years.

* A private sale is most common between small-to-medium enterprises (SMEs). For example, a restaurateur moving into a new area may buy an existing compatible restaurant, saving costs on the acquisition of the real estate, equipment, staff, and customers.

* Shareholder buyout is a common take-over scenario for partnerships. For example, a young vet, attorney, accountant, or doctor may join an existing practice and ultimately help its original owner retire by buying them out. Across enduring partnerships like major professional services firms, ownership is by an evolving mix of partners who buy into the business, work to increase its worth, and cash out on exit.

* Program transfer. Too often, government ventures don’t get enough time to prove themselves. The problem with shutting them down if they don’t meet a milestone — or if the new leadership demands a new flavor — is that it wastes a ton of money and goodwill. In this, I hope (and do my part) to see government programs increasingly built like ventures, with an exit in mind, so that they can keep at their legacy even if they must change hands. Across government ventures, a successful program may get absorbed into another part of the organization or even moved to another agency. In both cases, another part of the government takes responsibility for the budget and reporting obligations of the venture. While acquisition is not the term used for this, it does fit, and it does help us leverage private sector expertise for the benefit of taxpayers.

I hope to see government programs increasingly built like ventures, with an exit in mind, so that they can keep at their legacy even if they must change hands.

Exit option #2: Liquidate and dissolve

Granted, sometimes this is where you end up if none of the other options worked out. Hence, exit planning. However, this can be both a legitimate and a celebratory exit. In addition to what we discussed about mission-focused ventures, this is often the preferred exit for sole traders (consultants, hairdressers, massage therapists, personal trainers), for whom retirement often means finding a new home for any equipment still in good order, shutting down the website and the bank account, cashing out, and filing the last tax return.

You are your venture’s key asset, holding the power to squash it or to propel it into its next life.

Exit option #3: Go independent or IPO

Branch out. If you are holding prime IP with a university, spin off a venture that can commercialize it under license. If you represent an experimental government program, seek to establish yourself independently the way that Medicare (while the name means something altogether different in the US, UK, Australia, etc.) has. If you’re an investor-backed venture, go through the Initial Public Offering (IPO) to become a public company through selling your shares on a stock exchange.

Exit option #4: Staff buy-out

Some of the best-known staff-owned companies are Arup, Patagonia, Gensler, and HDR. In the US, this option is called an Employee Stock Ownership Plan (ESOP). Knowing several founders who have sold their businesses to their staff, I can attest to the veracity of this option if you trust your staff to carry on your legacy and can afford for your payout to trickle in over time.

Take a moment to check in with yourself

Each of these options triggers a tremendous amount of due diligence, marketing, and regulatory compliance. Before you consider these four options and rank them in order of your preference, do yourself a favor and check in with your feelings, because you — to your last day — are your venture’s key asset, holding the power to squash it or to propel it into its next life.

Does being absorbed into a mega brand feel like success or like failure? On your final day as the owner, do you want a load of cash, the confidence that your impact endures, the profile to launch your next venture, or a guaranteed easy job for life?

There are no wrong answers, so opt for inner honesty.

Q3: What is your preferred timeline?

Have you got 18 months? Five years? Whatever time it takes to leave your venture in good hands?

Your timeline may be driven by investor expectations. For example, if your loans are due in three years, that may set your timeframe. That said, if you are confident that you can raise further funds to take you to the next level, your timeline extends. Ultimately, when are you or your venture likely to run their course?

Q4: Who are your potential buyers?

In my experience, buyers — and I use this term loosely here to refer to those looking to take over your venture, whether it is government, for- or nonprofit — will also fall into three broad categories, the eliminators, the fixers, and the operators. Each comes with advantages and disadvantages, so consider your ideal successor.