Onside Issue 3 - Summer 2015 - 20

ONSIDE / ADVICE

PREPARING FOR EXIT

As Head of Research and Origination in the Seneca Partners Corporate Finance business and with
over 14 years of corporate finance advisory experience, Chris Summerscales works primarily with SME
shareholders and management teams, advising on raising finance, acquisitions and exiting businesses.

he decision to exit a business is one of the biggest and
arguably most difficult that business owners will face
during their business life, having typically lived and
breathed the business since it was established.
The majority of business owners will only have one exit
event in their business lives, as such it is essential to be well
prepared for an exit process in order to maximise value,
ensure the business goes to the right buyer and ultimately to
deliver a successful exit.

1. Understand the drivers for exit
Many entrepreneurs and owners have been with their
business since they were established, so attracting the
maximum capital value is not always the key driver behind

an exit. It is not uncommon for a business owner to want
the business to be passed on to the management team or to
a buyer or investor that will look after the workforce. The
key drivers are likely to have an impact on who the ultimate
buyer of the business is.

2. Valuation expectations
Have realistic valuation expectations. No two businesses
are the same, so whilst the valuation of similar businesses
is a good guide to follow, it should not be the only one.
Setting valuation expectations at a realistic level will attract
a larger number of potential buyers, which in turn will
drive a competitive exit process, subsequently driving the
valuation.

Table of Contents for the Digital Edition of Onside Issue 3 - Summer 2015