After we conclude the current market value of a business, the user is prompted to use the Exit Modeler, a tool that projects out the necessary growth for the user to reach their target value within their time to exit.
Purpose of the Exit Modeler:
The primary goal of the Exit Modeler is to demonstrate the delta between what happens if you "do nothing" against a deliberate value creation plan. Often, the former is bound to not meet the user's goals. The Exit Modeler is a helpful tool for:
Demonstrating the need for a value creation plan
A roadmap of milestones to hit year over year.
Below are the definitions of inputs for the Exit Modeler:
Target Value - target value is the "goal value" that you're working towards to exit your business. Your target value should be feasible and in alignment with your goals.
Time to Exit (Years) - the number of years that you plan to reach your target value. We recommend a minimum of 3 years, but it depends on a case-by-case basis.
The target value is not a static number and may need to be adjusted based upon your financial needs and time to exit.
Real growth is not linear. The effort you put in to grow your business may not be realized immediately. This is normal!