‘Trust Me, You’ll Exit Big’ — The 6-Word Lie That Builds Billion-Dollar Delusions!

Read time: 2.5 minutes

Ways to prevent being trapped in “Exit-First” Thinking

1. Use Valuation as a Strategy

• The focus moves from fundamentals to chasing high valuations.

• The short-term view is used to justify a product's future.

To Fix:

• Choose one primary business metric with which to build your decisions around (revenue quality, retention, margin).

• Make the metrics, not valuation, the basis of your decisions.

2. Shallow Growth is Fragile

• Growth based on surface-level metrics can look impressive; however, if retention is low, this growth cannot be sustained.

To Fix:

• Measure retention and repeat usage for your products as early as possible.

• Focus on measuring growth at a deeper level instead of surface-level values.

3. There is No Guarantee of Investor Alignment

• Investors have different incentives for their funds (i.e., they may want you to move quickly, but they may be using that money to fund sustainable businesses)

• To Fix:
  Ask potential investors, “What does success look like in 12-24 months?” and develop a plan to align your expectations before you scale.

4. Optics Can Replace Execution

• Presenting decks, narratives, and projections is often perceived as execution. Execution only happens over time.

To Fix:

• Make sure every initiative has a clearly defined metric.

• Remove any initiatives that do not meet a real metric.

5. Exit-First Thinking Can Impact Decision-Making

• Decisions made with the future buyer in mind rather than the current user result in weaker product-market fit.

To Fix:

• Focus on user value first.

• Build something that is worth selling, not just to sell but also to buy.

💡Key Takeaway: 

A business that only exists as a pitch deck is unlikely to thrive in the real world.