Up and Coming Weekly is a weekly publication in Fayetteville, NC and Fort Bragg, NC area offering local news, views, arts, entertainment and community event and business information.
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WWW.UPANDCOMINGWEEKLY.COM 16 UCW AUGUST 11-17, 2021 If you own a business, have you pre- pared an exit strategy? by THOMAS KELSEY According to Investopedia, an exit strategy is defined as "... an entrepreneur's strategic plan to sell his or her owner- ship in a company to investors or another company." An exit strategy gives a busi- ness owner the capacity to reduce his/her stake in the business. If a business is successful, the business can make a substan- tial profit, but if the business is not highly successful, an exit strategy allows a business owner to limit their losses. In either scenario, an exit strategy is important. As one might imagine, there are a number of different exit strategies to consider, but the most common are: initial pub- lic offerings, strategic acquisi- tions (sale of the business), management buyouts. e decision of which exit strategy is best to use often lies in how much control or in- volvement, if any, the business owner would like to have after they exit. For instance, a strategic ac- quisition means the business owner loses all stakes; there- fore, they have no responsibil- ity or control. e new owners may do what they wish with the newly acquired business. An initial public offering, like the name suggests, is when a private business decides to go public. is means that any major debt or lack of investor funding can be remedied by allowing the public to have a stake (in stock) of the business. Often, once a company goes public, the owner may still have a leadership role in the company, but all financial as- pects of the company are now public. IPOs are becoming more popular again, but are not ef- ficient for small businesses. Alternatively, a management buyout means that those who currently manage the company wish to buy it from the owner, who may be more hands-off in the day-to-day logistics. is is appealing to the man- agement team because they go from employees to owners, which is a major promotion. is can be achieved through an employee stock ownership plan, but again the company needs to be of a certain scale for the ESOP to be an econom- ical strategy. Our advice is to plan ahead and if you are considering an exit strategy in the next two years or so, seek the assistance of a business advisor who has the skill set and professional tools to help you decide which option is best for you and your business needs. THOMAS KELSEY, Transworld Business Advisors of Fayetteville. Comments? tkelsey@tworld.com BUSINESS & FINANCE Bring the family and a chair, relax to some great music. Parking available at 5pm and is $5 per person of each vehicle. Healy Beer/ wine and food sales begin at 5:30pm. No outside containers or coolers. No pets. Join us for Rock'n On The River concert series. August 27 th rocknontheriver@gmail.com Throwback Collaboration Band 6:00 pm 6:00 pm 1122 Person St, Fayetteville, NC 28312 North Tower 8:15 pm 8:15 pm