Preparing for an exit is one of the most critical phases in a startup’s journey. While many founders dream of the big sale, few prepare early and thoroughly enough.
Investors and buyers look beyond revenue figures—they demand clarity, structure, and transparency across every part of your company.
This checklist highlights the key areas to ensure your startup is “exit-ready.”
1. Cap Table Clarity
- Keep ownership records up-to-date and digital.
- Document SAFEs, convertibles, and option programs properly.
- Model dilution scenarios in advance.
A clean cap table signals professionalism and avoids costly legal disputes.
2. Governance & Shareholder Agreements
- Define decision-making rights, vetoes, and transfer rules.
- Document vesting rules for founders and key employees.
- Include drag-along and tag-along provisions.
Strong governance builds trust and prevents deal-breaking conflicts.
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3. Financial Hygiene
- Maintain accurate, up-to-date accounting.
- Use professional finance tools, not just spreadsheets.
- Track core KPIs (CAC, LTV, churn) and build realistic forecasts.
Solid financials show your business can scale.
4. Legal Clarity & IP Protection
- Ensure all IP belongs to the company.
- Secure trademarks and patents where relevant.
- Audit open-source licenses and third-party code.
Unclear ownership of IP is a major red flag for acquirers.
5. Team & Employee Participation
- Set up a fair and legally sound ESOP (10–15% pool is standard).
- Communicate vesting clearly.
- Align incentives to retain talent post-exit.
A motivated team increases exit value.
6. Operational Processes & Scalability
- Document workflows and systems.
- Reduce dependence on founders.
- Build scalable processes that buyers can trust.
Acquirers want businesses that run on autopilot.
7. Culture & Reputation
- Build a strong employer brand and founder visibility.
- Maintain healthy employee retention.
- Nurture investor, customer, and media relationships.
A positive culture and strong reputation can make or break an acquisition.
Final Takeaway
Exit-readiness is not a one-off project—it’s an ongoing process.
The earlier you establish clean structures, reliable processes, and transparent documentation, the stronger your position when investors or buyers come knocking.
Start preparing now. It’s the best way to maximize your company’s value when the right opportunity arrives.
