exit strategy

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Exit Strategy

1. In entrepreneurship and venture capital, a plan to end one's involvement with a business or investment while making the greatest possible profit (or smallest possible loss). An exit strategy is designed to turn an illiquid asset into liquid cash for the investor. The most straightforward exit strategy is simply selling one's business. If this is impossible, difficult, or unprofitable, another example is discounting one's products to sell as much as possible in as short a time as possible, as in a going-out-of-business sale.

2. In trade, a plan to close a position at a certain point. For instance, a trader may make a stop-loss order in order to close an unprofitable position.

exit strategy

The method by which an investor plans to cash out of an investment. For example, a venture capitalist may intend to utilize an initial public offering to liquidate an investment in a closely held company.
References in periodicals archive ?
He has assembled a panel of experts to discuss Financial Planning and Exit Strategies, a critical topic in today's franchise community.
In this paper, we examine exit strategies in the contexts of the family firm and the family firm portfolio for several reasons.
Before you buy, establish at least two exit strategies so that you aren't left with an asset that you can't get the value out of when you need to and that also could continue to cost you money each month.
But "preparing exit strategies cannot be put off," the OECD said.
In a statement, the bank said, 'The Bank of Israel's experience suggests that the exit strategies can be smoother than expected and market-positive when they come as normalization of monetary policy that confirms a recovering healthy economy.
A survey of nearly two dozen major military interventions since the end of World War II reveals that intervening powers were able to craft effective exit strategies in only about a third of the cases--and those happen to be the cases in which the goals of the interventions had already been met.
Talks on exit strategies will also be central to the meeting, although they will be discussed in more detail at next month's informal gathering of EU finance ministers in Goteborg.
It looked into various aspects of the exit strategies process, including how owners are planning to exit their businesses and their post-exit strategies and showed that more than 50% of business owners do not have a wealth strategy when planning to exit their businesses.
The majority of bosses (51%) of growing mid-sized businesses are facing difficulties in devising effective exit strategies, according to new research.
With the IPO door shut, your exit strategies have become somewhat limited.
In short, CPAs practicing in public accounting are well positioned to design and implement effective exit strategies for the founders and other owners of small and midsize family-owned companies.
Mr Hodgkins said: "There will be many varying reasons for the failure to exit but it is evident that increasingly the venture capitalists will be looking for new exit strategies in order for them to realise their investments and to make the appropriate r eturns to their investors.