“The protectors of our industries”. Cartoon showing Cyrus Field, Jay Gould, Cornelius Vanderbilt, and Russell Sage, seated on bags of “millions”, on a large raft, and being carried by workers of various professions. Date 7 February 1883

Exit Strategies are the new Gilded Age, Build Value Instead

Real growth is often slow, boring, and non-obvious.

An exit strategy is a poor benchmark to create meaningful value, for both yourself and anybody involved with you.

Exit strategies also involve venture capital or outside cash that want to either

1. inflate valuation. (so they make more money)
2. find more investors to provide capital for additional funding rounds. (so they further inflate valuation, and, again, make more money)
3. find an investment bank to provide even more outside capital and draft IPO documents. (so they further inflate valuation, and, again, again, make more money)

At every step, the gap between what you’re capable of bringing to the table and what the table is valuing you at is widening.

That widening is sometimes okay. Sometimes, a very large company might see you as a threat, and then they’ll try to purchase you out, effectively making a win on all three steps above. This is exactly what happened when CreditKarma started offering free tax returns and Intuit bought them out for $7.1 billion. Up to the acquisition, CreditKarma had around $900 million in funding over seven funding rounds over seven years.