Proactive investors and board members will help get both the business and the owner ready for a sale. Or maybe you will find yourself like me, approached about an acquisition long before you were thinking about it.

1. Don’t Let Emotion Decide

From fear to overconfidence, emotion can play a huge role in exit-planning decisions. When investors have a rational, profit-driven motivation to sell a business, and the founder isn’t ready emotionally, conflict can arise. The professional life of a founder is quite often defined by their business. Exiting can seem like a huge undertaking. The founder may resist on an emotional level, worrying about questions like “What does life look like after the sale? Who will help me? What pitfalls do I need to watch for? How does this even work?”

Conversely, a founder can be ready but investors may want to hold out to build more value to command a higher sale price. Founders may become exhausted, both emotionally and financially, especially when selling their products into a difficult market like ed tech. Or the business grows to a certain point and then the “product inventor” feels unqualified or uninterested in scaling the business.

2. Start the Conversation Early

Start the conversation and planning early. That way, all stakeholders can get in alignment and avoid unpleasant emotional conflict and prevent a long, drawn out, costly sale process. Even though my exit with my ed-tech company Zulama–which was acquired by EMC School–was a difficult emotional decision, the biggest complication was being unprepared from a due diligence standpoint.

The sale required a much higher quantity and depth of detail in the financials, contracts, and other documentation than those we had prepared for investment. That meant it took me and my chief financial officer a lot of time to find, organize, and prepare more documentation. Our lawyer helped as much as he could to keep our legal costs low. But there was so much back-and-forth between us and the acquirer’s legal team due to missing or incomplete information that we still managed to rack up a substantial legal bill.

3. Rely on Expertise and Support

It’s nearly impossible to create and implement a successful exit plan alone. Exiting is a process that takes collaboration and negotiation among several different professions—from lawyers, to accountants, to business partners and investors. The only way I kept my sanity through our exit was to break the process down into smaller, more manageable chunks and prioritize them. And ask for help!

4. Keep a Basic Plan in Place

Ideally, founders and board members work together to craft an exit plan that addresses the concerns, establishes the priorities, and achieves the objectives and aspirations for everyone involved. The plan changes as the metrics of the business change, but the sooner a basic plan is in place, the easier it is to keep it fresh and ready. That said, I was in the middle of an open investment round when an acquisition possibility presented itself. My board was not solidified, so we hadn’t started working on an exit plan.

5. Prepare, Prepare, Prepare

I realize that it sounds as if I’m recommending that you craft a plan, but then I just flew by the seat of my pants through my own acquisition. That’s fair. But don’t repeat my mistakes! Overall, ours was a good result. Yet it would have taken A LOT less time and money with more planning and preparation. So do yourself (and everyone around you) a huge favor and get your exit plan in place! 

This post originally appeared on the EdWeek Startup Blog. You can reach Nikki at

nn****@em**.com











“>

nn****@em**.com











.