Exit engine for ID8Labs. Position for and execute successful exits through strategic preparation, valuation optimization, and deal execution.
Position your product for a successful exit. Whether acquisition, acqui-hire, or strategic sale—preparation is everything.
Philosophy: Exits are not events, they're outcomes. Build acquirable from day one. The best exits happen when you're not desperate.
/exit <project-slug>Run full exit readiness assessment.
Process:
/exit assessEvaluate exit readiness and identify gaps.
/exit valueEstimate valuation range and comparable exits.
/exit dataroomCreate due diligence documentation checklist.
/exit memoDraft internal exit strategy memo.
| Exit Type | Realistic For | Typical Range |
|---|---|---|
| Acqui-hire | Any stage | $50K-500K |
| Asset sale | With users/revenue | $50K-1M |
| Strategic acquisition | PMF + growth | $500K-10M |
| Financial acquisition | Scale | $5M+ |
Too early signals:
Right time signals:
Warning signs to exit:
Exit readiness scorecard:
| Factor | Score (1-5) | Notes |
|---|---|---|
| Product-Market Fit | Evidence of PMF | |
| Revenue/Growth | MRR, growth rate | |
| User Base | Size, engagement | |
| Technology | Clean, documented | |
| Team | Dependencies | |
| Legal | Clean cap table, IP | |
| Operations | Systematized | |
| Market Position | Competitive moat |
Scoring:
Positioning for acquirers:
| Acquirer Type | What They Want | How to Position |
|---|---|---|
| Strategic (competitor) | Market share, customers | User base, retention |
| Strategic (adjacent) | New capability | Technology, team |
| Financial (PE/VC) | Returns | Growth, margins |
| Individual buyer | Lifestyle business | Cash flow, low effort |
Positioning activities:
Valuation methods:
| Method | Formula | Best For |
|---|---|---|
| Revenue multiple | ARR × Multiple | SaaS with growth |
| Profit multiple | EBITDA × Multiple | Profitable businesses |
| User-based | Users × Value/User | Pre-revenue, engaged users |
| Asset value | Assets - Liabilities | Distressed/no growth |
| Comparable | What similar sold for | Market validation |
SaaS multiples (solo builder scale):
| Growth Rate | Typical Multiple |
|---|---|
| <10% YoY | 2-3x ARR |
| 10-30% YoY | 3-5x ARR |
| 30-50% YoY | 5-8x ARR |
| >50% YoY | 8-12x ARR |
Adjustments:
Data room essentials:
| Category | Documents |
|---|---|
| Corporate | Formation docs, cap table, contracts |
| Financial | P&L, balance sheet, projections |
| Product | Tech docs, architecture, roadmap |
| Customers | Metrics, top accounts, churn analysis |
| Team | Org chart, key person dependencies |
| Legal | IP assignments, material agreements |
Preparation timeline:
| Timeframe | Actions |
|---|---|
| 12 months out | Clean up financials, document processes |
| 6 months out | Build data room, fix legal issues |
| 3 months out | Prepare materials, identify buyers |
| 1 month out | Finalize data room, practice pitch |
Deal structure components:
| Component | Description | Typical Range |
|---|---|---|
| Cash at close | Immediate payment | 50-80% |
| Earnout | Performance-based | 10-30% |
| Equity | Stock in acquirer | 0-20% |
| Escrow | Held for indemnity | 10-20% |
| Employment | Retention package | Varies |
Negotiation priorities:
Closing process:
LOI SIGNED
↓
Due diligence (30-60 days)
↓
Definitive agreement negotiation
↓
Final document execution
↓
Closing conditions satisfied
↓
CLOSE
Post-close:
frameworks/exit-options.md - Types of exits and fit
frameworks/valuation.md - Methods and multiples
frameworks/due-diligence.md - What buyers want
frameworks/deal-structure.md - Terms and negotiation
frameworks/acquisition-prep.md - 12-month prep plan
templates/data-room-checklist.md - Due diligence documents
templates/exit-memo.md - Internal exit strategy
templates/term-sheet-review.md - Analyzing offers
Perplexity:
GitHub:
strategic-think-tank:
After completing exit preparation:
Save outputs:
docs/EXIT_MEMO.mddocs/data-room/Log to tracker:
/tracker log {project-slug} "EXIT: Preparation complete. Valuation range: ${X}-${Y}. Ready for market."
Update state:
/tracker update {project-slug} EXITING
On successful exit:
/tracker update {project-slug} EXITED
| Red Flag | Impact | Fix |
|---|---|---|
| Messy cap table | Deal complexity | Clean up early |
| No financial records | Trust issues | Start tracking now |
| Single customer >50% | Risk | Diversify |
| Key person dependency | Risk | Document, cross-train |
| IP not assigned | Deal blocker | Fix immediately |
| Material litigation | Deal killer | Resolve before |
| Anti-Pattern | Why Bad | Do Instead |
|---|---|---|
| Waiting until desperate | Weak negotiating position | Plan 12+ months ahead |
| Hiding problems | Will surface in DD | Disclose upfront |
| Only one buyer | No leverage | Create competition |
| Focusing only on price | Miss bad terms | Evaluate full package |
| No advisor | Make mistakes | Get help on first exit |
| Neglecting business during sale | Value erodes | Keep running hard |
Before starting exit process: