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Exit stage left - The ultimate goal of an average Finnish software company?

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We already have enough data to start doing some preliminary analysis, though responses to this year's survey are still being collected. As a thesis worker, I have a personal stake in figuring out how Finnish software companies view exits - Which exit avenues they consider most plausible? Do the companies include M&A in their strategy, e.g. for boosting growth? How exit-oriented are the Finnish software companies overall? My questions are not limited to these three, but this is where I'll start my data crunching.

Note that the figures, statistics, and graphs presented here are based on preliminary data from an ongoing survey. The final results may vary from the current snapshot, as more data becomes available. As Rönkkö pointed out in his previous post, the early respondents are generally not representative of the entire population.

We had a three-part question set covering these aspects of a company's strategy and orientation. Regarding different exit avenues, acquisition by other company  was a clear favourite among the respondents as 26.1% of them had chosen it as a possible means of exit. Interestingly, employee buyout seems to be running for the second place with 6.9%. The graph below shows quite clearly that all the other choises are not valued too much.

We also included a question set concerning M&A strategy and orientation. Current distribution of the responses are depicted in the graph below:

From these answers we can derive that roughly 40% of the respondents are what we call "exit oriented". 35% stated that they have an existing exit strategy. From another perspective, 25% of the responding companies include mergers and acquisitions in their growth strategy.

When plotting the distribution of companies that have an exit strategy per age, we find that half of the companies that have operated for five to ten years have an exit strategy. From the youngest batch of companies under 2 years of age, only 20% have created an exit strategy. One can argue that if a company doesn't have an exit strategy, it is less likely to make a positive, lucrative exit. It seems that the youngest of firms haven't yet quite figured out their exit plans.

We can also see some indication of the company's size (by revenue) affecting the likeliness of having an exit strategy. In the 3 - 10 MEur range, 60% of companies have an exit strategy while only a third of the small, under one MEur companies have their exit strategies laid down.

 

Overall, the results of these early statistics are very welcome. I am personally confident that based on the high percentage of exit oriented companies, it will be possible to go deeper with analyzing different aspects that may affect exit orientation. Further analysis will hopefully reveal some common characteristics of exit-oriented companies.