We think we are making progress on our exit runway, but how do we objectively measure our exit readiness signals before we engage an investment banker?

Question

Tyler Smith · Accepted Answer

To know if your business is exit ready, you must look at objective operational signals rather than just your balance sheet. The ultimate signal of readiness is when you can step away from the daily operations for thirty days and the business actually grows or maintains its pace. Under the Step by Step Exit framework, we analyze specific operational signals to ensure your business has reached maximum transferable value before you ever engage an investment banker.

First, review your Accountability Chart. Every seat must be filled by someone who has the capability and capacity to run their department without your input. They must fully get, want, and have the capacity to do the job, which we call GWC™. If any major operational decision still requires your signature or personal approval, that is a clear warning sign.

Second, look at your weekly Scorecard. A buyer wants to see a consistent, historical record of clean data that shows predictable performance. If your scorecard is still tracking lagging financial indicators rather than leading activity metrics, you are not ready.

Third, examine your customer concentration. If any single customer accounts for more than fifteen percent of your revenue, you have a major vulnerability. Address these signals systematically in your quarterly Rocks to ensure your business is fully prepared for a clean exit.