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Era 3 · Series A

Prepare for an Exit

Raise your valuation before you sell, pick the Exit that pays the most Legacy, and choose what to keep for the next Company.

Use this guide when the Exit button appears on the toolbar and you want to get the most Legacy out of this Company.

An Exit ends the Company and pays Legacy. Legacy grows with the square root of your payout, so a payout four times as large gives twice the Legacy. The payout is your Equity times the valuation times the Exit's multiplier. See Why a Company ends.

Know your options#

The Exit panel lists the Exits you can take now:

ExitOffered fromMultiplier
Acqui-hireSeries A0.5, on a valuation of at most $50M
AcquisitionSeries B1.0
IPOPre-IPO, with the checklist1.5. The Company goes on into the Public Era.
Step downPublic1.5, plus 0.1 per quarter in your beat streak, up to +1

See Exits for the full rules.

Read the offer#

  1. Click Exit on the toolbar. Its badge shows the most Legacy an offer pays now.

  2. Read the four figures at the top: Valuation, Rule of 40, Equity, and Legacy ×.

  3. Read each offer's payout and its Take button, which shows the Legacy it pays.

If you do not take an offer, nothing happens. The offers stay and change with your valuation.

Raise the valuation#

The valuation is your yearly revenue times a multiple. The multiple grows with your Rule of 40 score: user growth plus profit margin, in percent.

  1. Grow revenue. Every point of Apdex below target loses users. Fix the bottleneck first. See Find the bottleneck.

  2. Raise the margin. Margin is income minus Burn, over income. See Cut the cloud bill.

  3. Keep users growing. Growth counts over the last calendar week, so a recent loss of users lowers the score.

  4. Research Investor relations in the Pre-IPO Era. It adds 2 to the multiple.

  5. Open the Exit panel again and compare the Valuation figure.

The multiple has a floor and a ceiling, so past a point a higher Rule of 40 adds nothing.

Protect your Equity#

Each funding round you raise lowers your Equity. The payout uses your Equity, so a decline keeps more of the Exit. Declining also slows growth in the next Era. Weigh the two at each offer. See Cash, Burn, and funding.

Pick the Exit#

  1. Take Acqui-hire only for a fast restart, for example to try a new Venture. It pays half, on a capped valuation.

  2. Take Acquisition when you reach Series B and do not plan to reach the IPO.

  3. Aim for the IPO for the best multiplier. It pays at listing, and the Company goes on. Step down later pays only for what the Company grew since the IPO.

Prepare for the IPO checklist#

In the Pre-IPO Era, the HUD shows the IPO checklist. Every item must hold at once:

  • Users: reach the Era's target.

  • Reliability: availability this week at or above the SLO.

  • SOC 2: research SOC 2 program and Security team.

  • DR drill: research Disaster recovery drills and click Run DR drill. The drill fails your home region. Serve users from another region within an hour, and lose less than five minutes of writes.

  • Data residency: research Data residency controls and serve EU users from EU data. See Go global.

  • Rule of 40: a score of 40 or more.

When every item is met at once, the IPO button appears on the HUD. The IPO cannot be declined.

Take the Exit#

  1. Click Take on the offer you chose.

  2. If you own Institutional knowledge, pick the Research to keep under Keep research.

  3. Click Legacy shop to spend your Legacy, or Next company to start again.

Cash, users, the board, Research, the Team, and Equity reset. Legacy, perks, Playbooks, and achievements stay. Save a Playbook of your best sub-design before you exit, so the next Company starts faster.

Check the result#

  • The Exit screen shows +N Legacy and the payout. Compare it with the badge you read in step 1.

  • The Legacy shop shows your new balance.