In conversation with: Calum Smeaton

Welcome to our Q and A series, where we bring together entrepreneurs and leaders in the business community. Each interviewee brings their unique perspective and hands-on experience of the challenges faced when starting and scaling a company.

19 September 2023

Calum Smeaton

Calum Smeaton, CEO of Smeaton and Associates, talks Making an Exit

At what stage of building a company should you be considering an exit strategy, if at all?

As early as possible. The type of business you are building will dictate the likely exit route, lifestyle businesses are more difficult to “exit” and high growth venture backed businesses are put on a conveyor belt to get to an exit.  The quicker you know what type of business you want to build, the quicker you can start thinking about your exit strategy, which ensures you put in the foundations to make it easier to exit when the time comes.  

How do you know it is the right time to sell your business?

There are two parts to that problem, the first being are you ready to sell and the second being is the market ready to buy. As a founder you need to be ready to let go of your baby and you need a team and the foundations in place to be able to successfully complete a transaction. If the market you are in is getting bigger and it attracts larger more established competitors to enter into it, you may find there is a window of opportunity to exit before the market gets hyper competitive.

The market typically tells you when you can exit, competitors being bought, inbound interest and strong growth rates across the market. Trying to sell when the market isn’t ready is like pushing water up a hill.

Are there any common mistakes founders make when it comes to selling a company?

Underestimating the time and resource it takes to complete a successful process. If you are not set up with the appropriate resource and skills to run the company and run the process in parallel, then both will suffer. Not having the right advisors from legal, finance and investment banking is a common mistake. It is better to get the best you can afford than trying to do it on the cheap.

What advice would you give other founders who may be considering selling their company?

Make sure you are really ready to sell, both from an individual perspective and from a team perspective. If you don’t have strong foundations in place and you don’t have good corporate hygiene, then it will be difficult to get a good outcome.

What advice more generally would you give to first-time entrepreneurs?

Don’t give up. If in doubt, be bold. Remember, experience is the thing you get just after you really needed it.

To read more of our resources around scaling up and starting up, as well as more of our Q&As, click here.