Leaving a startup you helped to create : A qualitative study of managerial exits

Abstract: In the last decades, the growth of startups i.e. newly created business ventures,have been increasing heavily, especially in the tech sector. However, the research stream regarding these ventures has lagged, notably in the area of exit strategies. This area of research is an important subject within entrepreneurship. Exit strategies have mainly been researched from a single entrepreneur's perspective, which is not always the case when a new business venture is developed. Quite often a startupcanbe launched by a group of entrepreneurs, therefore is the main purpose of this study to develop a deeperan understanding of which triggers for a management exit and how these triggers affect the choice of exit route and the outcomes for a startup. Furthermore, this study examineshow triggers such as strategic and financial distress influence the decisions of an exit strategy. We identified a research gap, since there is quite limited research on exit strategies, especially from the perspective of an entire group.We can also see that further and in-depth research needs to be conducted about grouptriggers and especially how the group member’s influence one another when deciding on an exit route, in order to understand the underlying triggers of the exit. In order to fulfill the purpose of this study and to be able to answer the research question, a qualitative study has been decided upon. In this thesis, six qualitative interviews wereconducted with a semi-structured approach. The interviewees are all part-owners of the firm and had heavy influence when the exit was conducted, they are all either within the operational management of the firm, main shareholders and/or board members. However, in common for all the interviewees is that all of them have shared ownership in the company and all the interviewees havebeen a part of the startup since itsfirstlaunch. The general themes chosen for the interview guide werethe following: intentions to exit, exit routes andexit outcomes. We conducted a thematic analysis of the findings of the qualitative interviews, in order to answer the research question. The findings, as well as the analysis,were presented in the logical order of the theoretical frameworkto make ease the possibility for comparison of theory and results. From our results,we could conclude that what triggers a group to exit a firm they helped create is a mix between different factors, which in turn affects the exit route chosen. We could conclude that the triggers that play the biggest role are both individual and firm triggersin combination with each other. The individual triggers we found to be of most relevance were the entrepreneurial and industry background of the group members. Furthermore, we found that these individual factors of the group members affected each other, and that one trigger not mentioned in previous research played a big role in the exit, which was the expectations on the outcome of the exit. When it comes to the choice of the exit route, we could conclude that the level of voluntariness of the exit influenced the exit route to be chosen, together with the performance of the firm.