Barbell Exit Strategy

A strategic framework for company exits, highlighting why the middle ground ($10M-$100M) is the most challenging exit range, and what strategies work best.

The Barbell Strategy for Exits

• Two optimal exit points:
  • Small exits (<$10M): Easy acquihires
  • Large exits (>$100M+): Strategic acquisitions
• Middle ground ($10M-$100M) is the hardest to execute

Why Small Exits Work ($10M and under)

• Companies can cut checks quickly without much approval
• Based primarily on talent acquisition
• Often results in ~$10M exit for bootstrapped companies with small teams
• Clean and straightforward process

Why Large Exits Work ($100M+)

• Companies have enough strategic value to matter
• Larger companies have capital for significant acquisitions
• Clear value proposition for acquirers
• Strong assets (technology, traction, or unique talent)

Why Middle Ground is Challenging ($10M-$100M)

• Too expensive for quick decision making
• Not enough strategic value for big acquisitions
• Harder to justify price tag to acquirers
• Often stuck in "no man's land"
• Usually raised enough money to require higher valuations

Strategic Implications

• Better to be ambitious and raise significant capital
• Focus on hiring the best team possible
• Target large markets with significant tailwinds
• Ensure you're building enough value to matter to strategic acquirers
• Worst case: Build something worth more than capital raised

The Entrepreneur Factor

• Middle-ground exit entrepreneurs are "dangerous"
  • Have enough money to take bigger swings
  • Still hungry for larger success
  • Experienced but not satisfied
  • Often make excellent future founders