Question

What is an exit strategy? Why is it essential?

Who buys up startups? What do they buy them for?

Answer 1

Exist strategy refers to a situation when leaving ones current positions that can be the achievement of predetermined objectives or strategy mitigate failure.

An exit strategy may be executed to exit a loss-making investment or closing an unprofitable business to stop the further investment.

Exit strategy can be through IPO, acquisition, etc.

It is essential to protect the business further loss and protect the unwanted happening and creating a controllable position. An exit strategy safe entrepreneurs to limit the losses and protect the owner from further liability.

Angel inventors and large size companies are buying the startups by analyzing the future, opportunities, market values, customers base, advancement, scope of business, sustainability, etc.

Mostly they buy them for acquiring customer base, inventions, decreasing competition if startup in the same segment, diversification, entering in news markets, boosting the investment, artificial intelligence, database, etc.