...not a sprint. Sometimes, because entrepreneurs and investors talk about exit strategies, one side or the other gets the impression that this whole process is more sprint than long distance run.
Well, it isn't.
Entrepreneurs have to have a sustaining passion for the business that goes well beyond financial results and exit achievements. We get pushed up against exit timing by investment documents and, if we aren't careful, we can make less than optimal decisions.
While it is true that the longer it takes to achieve a five or ten times-your-money return, the lower the value it is, nonetheless, the path and the timing to that event will almost always take longer and cost more than either the entrepreneur or the investor may think.
Comparability is probably a very important element here. If others are exiting, that provides one set of comparables. But it may also provide an opportunity to be a consolidator rather than a seller.
Some businesses will take longer to mature - based on strength of ties to customers, the nature of the business itself, average order size, acquisition cost - the list goes on. All of these things are interdependent.
We have one portfolio company that is beating its plan on a timing basis. This gives the owners a wider range of choices than they would otherwise have.
Be as certain as you can - whether you are an investor or an entrepreneur - that you both have talked about what happens when things take longer and cost more. It can avoid a lot of unhappiness later.