The startup world loves to talk about the potential upside, the potential exits. While there are plenty of newsworthy exits — think Qualtrics being acquired by SAP for $8 billion — the reality is that exits are few and far between, especially outside the startup centers.
After startup investing for a decade now, and doing over 30 deals, I’ve had exactly one exit and two partial exits (selling some secondary). Now, on paper, the overall returns look great but it’s really, really hard to get any liquidity. Building great companies takes time, decades of time.
For entrepreneurs, the key is to build an enduring business. A business that provides value to all stakeholders, grows in perpetuity, and has the ability to generate sustainable profits is the true measure of success. Should a strategic buyer come along, great. If not, no worries.
In fact, in today’s market, if a startup is venture backed, they need to be on a path to $100M+ in revenue to have the opportunity to go public. Going public is an “exit” in that shareholders get liquidity and the company raises money from the public markets (assuming it isn’t a direct listing). Going public is the exit venture-backed startups should focus on.
If a potential investor asks about an exit strategy, the answer should be to build a large, enduring business. Then, and only if the investor is looking for more specifics, offer up the logical acquirers for the business. Too many investors ask about an exit strategy, when, in reality, the world doesn’t work that way. Companies are bought, not sold.
Build a great business and acquirers will come knocking; everything else is conjecture.
David Cummings on Startups 
Well said and makes a lot of sense. So David, you’re saying is have a mind-set and business plan strategy of “Build it and they (customers) will come” v.s. “Build it and they (investors) will buy”
Spot on David…Build a business, that is the goal.