Successful exits are not a one-day process, ex-Goibibo and MMT CPO tells founders

In this episode of Prime Knowledge Series, Anshuman Bapna, former CPO at MakeMyTrip and Goibibo, talks about the need for founders to think and plan for exits, and why it’s vital to keep employees in the loop.
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“The most sophisticated end to your stint as the founder of your startup is to take it towards a graceful exit,” says Anshuman Bapna, ex-Chief Product Officer at Goibibo and MakeMyTrip, and Founder of Terra.do

He adds that the path a founder walks defines their career in the days to come. 

An alumnus of IIT-Bombay and Stanford Graduate School of Business, Anshuman is a serial entrepreneur. He has previously co-founded traveltech startup mygola, Democracy Connect, and Right Half. His current company, Terra.do, is an online school for people who want to help tackle climate change

Anshuman Bapna



In this week’s episode of Prime Knowledge Series, Anshuman talks about how to run the exit process of a startup

Anshuman says even the most veteran investor struggles to identify the right exit. “As a first-time or second-time entrepreneur, remember that all the exit plans that you currently have chalked out are bound to have loopholes.”

He adds that exits are never easy for founders. More so because the energy and time entrepreneurs invest in their company cannot be quantified by money. They have responsibilities towards employees and investors, and must also think of their own future.

However, running the right exit can be summed up by three points: thinking about exit early, treating the exit as a process, and keeping the investors and employees in the loop.

“These ensure you can maintain your grace, protect your relationships, and set up another shop without hiccups. A billion-dollar deal is always on the cards, but a flimsy plan may never take you near that,” says Anshuman. 

Think and plan your exit

Entrepreneurs cannot leave the exit strategy until the very last moment. Starting just three months prior to the exit, an entrepreneur will soon find his bank running dry, sales hitting rock-bottom and user base turning thin as they start cutting costs, thinking about a sale. 

When a startup’s growth slumps, the buying company may pull out at the eleventh hour, citing the dip as the reason. This leaves the entrepreneur with no choice but to accept. The ultimate result might also be a deflated offer where nobody in the startup walks out as the winner

“As a rule of thumb, start thinking and planning your exit at least nine to 12 months before your planned date,” Anshuman says. 

This will ensure that the team feels valued and phases out the business seamlessly.

During this phase, the founder should not take their eyes away from growth. “Standing on thin ice right before the sale does not paint a good picture of you,” he adds.

Treat it as a process 

Successful exits are not a one-day process. Entrepreneurs do not merely sign a couple of papers and immediately receive the amount in their bank accounts. “Depending on your exit route, you have to manoeuvre your company through the market,” Anshuman says. 

If an entrepreneur’s strategy involves acquisition, the company’s growth should be centred on the product it sells. This is because larger firms are majorly interested in the value of the product. 

Similarly, in case a company intends to go public, its valuation and customer base will be major drivers. Along with these, entrepreneurs will also have to make a list of suitors who will be willing to buy it or invest in it. This will leave enough options on the table as the end draws near.

“Treat your exit as a complete process. Start by building Excel spreadsheets, keeping tabs of your progress and names. Keep things clean and build relationships along the way so that finding buyers does not become a herculean battle,” Anshuman adds. 

Keep stakeholders in loop 

A company belongs as much to employees and investors as it does to the founder. 

Before deciding to exit, founders should have a town hall meeting with all the employees, regarding the need to sell. They should clear their stance and explain the final outcome, showing the optimising routes that they are taking to ensure a win-win situation

In fact, Anshuman says that if a company has a talented pool of employees, they can even help the founder run the exit process.

Avoid running a side-table deal in a closed room. Bring your people in and keep them in the loop,” he adds.

Exits are definitely not easy. But changing the mindset from money to relationship and strategy can lead to a successful exit.

(Edited by Teja Lele Desai)