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Ask HN: Isn't planning exit b4 starting, ~ framing prenuptial divorce agreement?

3 points by gamebit07 ↗ HN
I have a minimal upstart. I have approached to couple of angels, few have been kind. No matter whom I talk to, the question is inevitable - "What is your exit strategy?"

Isn't this akin to framing a prenuptial divorce agreement, before getting married??

3 comments

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incision
Do you think they strictly mean it that way? Sure, they ould literally mean "How and when do you intend to flip this thing and pay me off?", but you don't necessarily have to answer in those terms.

Personally, I'd take it as a general question about planning, expectations and commitment. Is there are a point where you certainly want to cash-out? Do you intend to make this your life's work? Have you thought about how this business would function at double, 10x or 100x the current size?

caw
The other "exit strategy" is when to cut your losses and quit. At that point, what do you do? What criteria would you use to figure that out?
tptacek
That's a question I thought a lot about when I was 22 and getting my first round of funding, but today, at 36, I would just dodge. "I'm sorry, I'm really not thinking about that. I'm just concentrating on how to make my business as successful as possible. The bigger we get, the more options we'll have."

Maybe things have changed in the last 8 years, but I imagine that anyone you'd want to take money from knows exactly what the exit strategy of a tech startup is. Investors probably aren't screening you with the actual answer to the question.