Build-to-Sell Powered by Intellectual Assets: A High-Growth Technology Business Perspective

Abstract

Owners of high-growth technology businesses should decide at an early stage whether they are developing their company for continuation as an independent organization (build-to-grow) or for an exit (build-to-sell). The choice of one pathway over the other has a huge impact on the strategic decisions made when building a successful business.

The three key intellectual assets—technology, brand, and operational excellence—are dominant value drivers for an exit deal in a build-to-sell process. Developing a sound portfolio of intellectual assets over many years before the exit will not only provide the business owners with an increased exit valuation, it will also give the company a sustainable competitive advantage in the event a planned exit does not take place or is delayed.

When a build-to-sell choice is made, a dedicated board function should have the prime responsibility for the salability of the business, allowing the CEO to remain focused on the growth of the business. Continuous management of the exit process years in advance and for some time after the exit transaction is crucial for ultimate exit success.

Keywords: build-to-sell, IA, Intellectual Assets, high-growth technology business, technology, brand, operational exellence