Pioneering women entrepreneurs want those following in their footsteps to know that it's just as important to plan how to end your business -- whether by selling, handing down to a child, or closing -- as it is how to start it, finds a new study conducted by the Center for Women's Business Research and underwritten by Massachusetts Mutual Life Insurance Company (MassMutual). The report, Exiting Your Business: Serendipity or Strategy, examines steps women should take and missteps they should avoid when preparing both professionally and personally for exiting their businesses. The study, which analyzes nine in-depth interviews with women whose businesses generated $4 million or more annually in revenues, is a companion to the quantitative report released in 2006, Exit Strategies of Women and Men Business Owners, also underwritten by MassMutual.
The interviews reinforce the findings of the previous study and detail how these women handled exiting their businesses and their ensuing life choices. "This study fills a gap in research on women's entrepreneurship," said Margaret A. Smith, chair, Center for Women's Business Research. "There is very little research on women's transitions from business ownership, how they accomplish it and how they go on with their lives. The first person accounts provide the stories behind the numbers. The research showed that most women and men business owners did not have any exit strategy. This is unfortunate, because when times got hard, those without a plan in place were more likely to close their business or settle for less than optimum returns." Further, the majority (67 percent) of women and men surveyed had no sales plan in writing and a large proportion (43 percent) had not conducted a formal valuation of their businesses. The women interviewed who didn't have a succession plan couldn't act quickly enough when markets changed and consequently lost the option of selling. Their only option was to shut their doors. Among those who were able to sell, the most satisfied were the ones who had clear goals and parameters which allowed them to position their companies and choose their strategies accordingly. Exit planning is typically measured in years. It takes time, with the help of both expert and informal advisors, to determine the value of your company and the best way and time to exit. Almost all the women in this survey had at least one trusted advisor. Many tapped into their networks of entrepreneurial associates for advice and almost all relied on their CPAs or attorneys. The following are among the top recommendations of women who have exited their businesses: - Run your business every day as if it is for sale.
- Be aware of your goals and parameters.
- Know what you will accept in a sale and what's not okay.
- Don't let the word get out prematurely to your employees and others that you are considering a sale; often the sales process can take a long time and until all details are worked out, it is best to not worry your employees. When ready to sell, be very decisive.
- Find a buyer who shares your vision and approach and put many of the conditions of the business and the sale in the sales documents. Get buyers' promises during the courtship in writing.
- Take care of yourself. Develop an investment and insurance portfolio separate from the business.
For more information, visit http://www.womensbusinessresearch.org. | 
