Outside Investors

When taking on an investor's money, among the many stipulations you should add to the partnership agreement, is some provision for how to get out of the arrangement.

Formula Exits

Many private equity investors will spell out their exit strategy ahead of time, in their original term sheet and in the shareholder agreement, complete with a timetable (usually no more than 5 years) and a commitment on your part to sell the company within the designated time frame or take the company public or buy the investor out at a price which guarantees the investor a certain rate of return.

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