Preparing for failure…is this something we should take into account when developing our private practices/entrepreneurship? Many marriages develop prenuptial agreements in the anticipation of a divorce. I would imagine, that when you marry someone you don’t really anticipate or look forward to separating from your significant other (why would you get married in the first place??). However, when starting up a business, is this something that should come into play when developing your business plan? Like a “Plan B” or “Exit strategy”, or would this loom over you and your developing business as an expectation?…How distracting would this formulation of anticipated failure be in the development, pursuit, or even the passion to which you go after your new business? In essence, we prepare for the end to most things, for there is an existential understanding that all things come to an end eventually, it is just a fact of the finiteness of our world. There are numerous services to support exit strategy in handing over a business, changing ownership, merging companies, however, how important is this if it is directed at the end, due to lack of revenue and clientele, in a new business?
Exit strategy relates to how you envision your business “ending” by way of merging, sale, or liquidating assets, and is recommended by several business planning web resources to take place along side the development and plan of your business. However, my question remains, what if things don’t work out. What if it just isn’t working after 2,3,4 years, and it all goes to hell…do we plan for this?
I tried to think of working with an athlete client. Would I tell them, “we should really think about what you are going to do if you tear your ACL this season”? Probably not… not really establishing the best mindset for the athlete. However, with personal financial investment, taking that “risk” on the market…should this question be in my top ten? Also, are there maybe positive, more proactive ways to develop an “emergency kit” when my business is failing…just in case? We know now the perils that can come with going into private practice, I think I may feel better knowing that if I do end up on the downside, what will be waiting there for me instead of falling into a deep black hole I will have to climb out of financially and emotionally.