VC and entrepreneurs have different set of goals and objectives. VCs have a short time horizon and they want to get their money back and much more. For them, their goal is to have a great IPO or a lucrative M&A deals.

However, as entrepreneur who is building the company, I think he/she needs to focus on profitability/product/organization. Focusing on the exit event will distract the entrepreneur. A lucrative exit event is a byproduct of profitability/great product/great organization/etc, but not the other way around.

I'm not saying that the board shouldn't plan possible exit options — every company should have that analysis, like you said, annually. But, it shouldn't be the goal for the company. Take care of profit/product/organization, the rest will follow.

In order to achieve something, you need to have goals (which require goal-posts). IPO is just a goal-post. It might be M&A as well or some other liquidity event, or the goal may just be to stay private forever, and pass on the business to your family. Whatever the goal posts, one needs to have some defined goals on what they want to build and how to get there.

So, I would argue the opposite. Just growing the business without having a tangible exit in mind doesn't make sense. In fact, I would suggest entrepreneurs and VCs alike should do an “exit analysis” every year to figure out how far away are they from their goals and the goal posts. Some boards already do this.

VC and entrepreneurs have different set of goals and objectives. VCs have a short time horizon and they want to get their money back and much more. For them, their goal is to have a great IPO or a lucrative M&A deals.

However, as entrepreneur who is building the company, I think he/she needs to focus on profitability/product/organization. Focusing on the exit event will distract the entrepreneur. A lucrative exit event is a byproduct of profitability/great product/great organization/etc, but not the other way around.

I'm not saying that the board shouldn't plan possible exit options — every company should have that analysis, like you said, annually. But, it shouldn't be the goal for the company. Take care of profit/product/organization, the rest will follow.

In order to achieve something, you need to have goals (which require goal-posts). IPO is just a goal-post. It might be M&A as well or some other liquidity event, or the goal may just be to stay private forever, and pass on the business to your family. Whatever the goal posts, one needs to have some defined goals on what they want to build and how to get there.

So, I would argue the opposite. Just growing the business without having a tangible exit in mind doesn't make sense. In fact, I would suggest entrepreneurs and VCs alike should do an “exit analysis” every year to figure out how far away are they from their goals and the goal posts. Some boards already do this.