The subtle art of knowing when to exit your own company3 min read . Updated: 04 Nov 2019, 11:46 PM IST
Exiting responsibly is possible only when an organization is built responsibly throughout its life cycle
Of all the decisions that an entrepreneur has to take, one of the most important is knowing when to quit.
The word “quit" is associated with failure, losing and giving up, and so the entrepreneur tends to prolong the journey of his or her startup by different means.
In my case, it was different. I had a clear idea of what needs to be achieved within a certain time-frame.
Exiting responsibly is possible only when an organization is built responsibly throughout its life cycle.
What does building responsibly mean? It is doing what is right at all times, taking tough calls, keeping business and personal matters apart, building an accountable and performance-driven culture, being compliant with all processes, managing all stakeholders fairly and transparently, having clarity on when to stop, and keeping stakeholders in the loop at all times, irrespective of the results.
We, at HealthMacro, did this through our monthly investor reports. HealthMacro’s software products powered diagnostic labs, radiology centres and hospitals. We had built business across five states and received favourable feedback.
When I started, I had given myself five years to make HealthMacro a profitable venture. I had crossed that time limit; now it was six-plus years. Though we were regularly generating revenue and scalability, getting to profitability was a challenge. The slow clock speed of the Indian healthcare industry—the long sales cycles, the poor payment terms and more had tired me. Continuing further was not the right decision.
Not everything lasts
Given that I had a clear criteria and all stakeholders, including the investor, were informed of the progress and challenges, it was fairly easy for me to make a decision on the exit.
Was it stressful? Of course, yes. It was a period of a lot of stress as I was not sure how to exit while balancing various stakeholders. How will they react? What will be the repercussions? But I was confident that given the way we had built our company, we could exit without any negative repercussions.
Was it painful? Yes. It is painful, going through the motions of closing down something one had built with so much hard work. It was around the first week of April that we took the call to ensure that we did not carry the business into the new financial year. Conveying the tough news to customers is always hard, but it was done honestly and fast. We met most customers personally to inform them of the news, and followed it with a formal letter that informed them of the next steps and timelines. When they were not reachable, emails were sent.
All measures were taken to ensure the contractual terms were followed. We took steps to support customers for the next four months and help them migrate to other vendors.
We kept employees clearly posted on the “why" of the decision and assisted them in job hunts as we ramped down the team.
Lastly, being fairly well known, I did not want HealthMacro to suddenly disappear. So I took a call to put up a post on LinkedIn about HealthMacro’s business exit, and the reasons for it. I also used the post to share my learnings.
Usually people put up posts when they start a venture, or raise money or achieve success. But I was putting this post online for a venture we were shutting down. I did not know how it would be received. I was surprised by the overwhelming response it generated across various quarters.
Exiting responsibly is not giving up. It, in fact, helps you become a better entrepreneur and enhances your reputation. It demonstrates that you will be consistent in your values, irrespective of the results.
Shashi Bhushan, the founder-chief executive of HealthMacro Technologies Pvt. Ltd, is presently exploring new opportunities.
Write to us at email@example.com