Exit strategies define how founders and investors eventually realize value. Three main paths: (1) IPO — going public (rare, requires $100M+ revenue), (2) M&A — acquisition by a larger company (most common), (3) Secondary sale — selling shares to another investor (partial liquidity). The exit strategy influences every decision from Day 1.
Key Takeaways
- M&A is the most common exit (90%+ of successful exits).
- Strategic acquirers pay premium for AI + medical device IP.
- Typical medtech multiple: 5-10x revenue.
- Exit strategy from Day 1 — it shapes every decision.
Frequently Asked Questions
What is the most common exit path for VC-backed startups?▼
Answer: M&A (acquisition)
M&A accounts for 90%+ of successful exits. IPOs are rare and usually reserved for very large companies ($100M+ revenue).
Who are the most likely acquirers for a medical imaging AI company?▼
Answer: GE Healthcare, Philips, Siemens Healthineers, or other major device companies
Strategic acquirers are large medical device companies who want to add AI capabilities to their existing product lines.
The typical acquisition multiple for a medtech company with €10M ARR is:▼
Answer: 5-10x revenue
Medtech companies with recurring revenue typically sell for 5-10x revenue. Higher multiples (10-15x) for fast-growing, high-margin companies with strong IP.
When should you start thinking about exit strategy?▼
Answer: From Day 1 — it influences every strategic decision
Exit strategy from Day 1 shapes: which investors to take, what IP to build, which customers to target, and how to structure the company.