Some founders and entrepreneurs start with a specific exit in mind. Some are less focused on the exit to begin with, but over time, and particularly if you raise money, then your exit, or partial exit becomes something you have to consider. And yet, like so many issues around talent, it is usually an afterthought, until it becomes urgent! It’s hard to make the right decision, to find time to be considered, when a matter is urgent. Planning the growth of your business has to include, planning what talent and skills you’ll need, and when. And never more so than when you are thinking about that exit.
Having a solid management team is very important when you are fundraising, I’ve written about this before, in this article with Jelena Markovic, Senior Associate at BayWa r.e Energy Ventures. But how much more important when you are looking to exit, or even step into a new, less frontline role? Who will buy your business if it can’t function without you? Don’t wait for an ‘earn-out’ period to replace yourself. Put yourself in a position of strength for all of your negotiations, by having replacements and upcoming talent in place for you and all the key roles in your business. It’s best for you, and of course for your business, employees and investors.
Sometimes, you might not be planning your imminent exit, but having potential successors in place opens the door to the possibility. something one of our clients, Erik Nygard, found out recently. Erik was CEO & Founder of Limejump, which was acquired by Shell Energy. Whilst scaling his team we helped find an outstanding COO to be his No.2 leading the business. Within a year Erik took the opportunity to exit the business completely, the COO becoming the CEO, allowing him some family time before considering his next ventures. This was only possible because of the quality of his successor. She was more than capable, and both Erik and Shell knew the business would be in very safe hands. I share some thoughts on this in the short video with Erik below.
I’ll be speaking a good deal in the coming weeks about the importance of both succession planning, but also staff retention. Retaining your key players is critical to your success. You may be thinking why would an executive search firm encourage you to keep your best employees, surely we’d rather help you replace them!? Well, that’s not how we work, or what drives us. Helping cleantech start-ups and scale-ups to grow, and helping founders to exit is what drives us. moving the whole sector forward, helping cleantech companies to succeed. It’s difficult to sail to your destination if there is a hole in your boat!
If you are contemplating or struggling with any of these issues, then reach out and let’s have a coffee. Virtual for now. I’m happy to share my thoughts and experiences from working and interviewing thousands of leaders, founders, VCs, working with accelerators, and of course the CEOs and founders I interview on my podcast.
A leader’s lasting value is measured by succession. – John C. Maxwell