Making sense of entrepreneurial exit strategies: A typology and test

• A review of the state-of-the-literature on entrepreneurial exit strategies
• A typology of exit strategies (financial harvest, stewardship, voluntary cessation)
• An empirical test of typology based on relevant firm and individual predictors

Entrepreneurial exit is a major event in the development of a venture. However, we have little understanding of the factors that drive the development of an important pre-cursor to exit: the exit strategy of the founder. Based on the existing literature, we develop a typology of entrepreneurial exit strategies consisting of three higher-level exit categories (i.e., financial harvest, stewardship, and voluntary cessation) and develop an initial test of our typology. Specifically, we examine entrepreneurs' perceived innovativeness of their opportunity, motivational considerations, decision-making approach, founding team, and firm size. Our results show different predictors for each of the three exit strategy types and represent a significant contribution to the understanding of exit strategies in new ventures.