The Exit Strategy

By Barry Nathanson

During the normal ebb-and-flow of my days in the beverage business, I spend the lion’s share of my time and energy meeting and talking with beverage marketers. It is a most enjoyable way to spend that time. At our recent conference, the pace quickened exponentially: there were literally over a hundred brands, mostly new, entrepreneurial enterprises to entertain.

I love the energy and excitement of these entrepreneurs as they wax eloquent about their hopes and dreams, their planned paths to success.  Some have cogent visions of what it takes to succeed, while others are pipe dreams. The ones who will achieve their goals need great-tasting products, sublime packaging and tactical marketing initiatives, and luck. They lay out their plans and I wish them the best.

One aspect of their presentations, though, is a major turnoff. I listen as they detail their business plans, and sadly, many of these companies boldly and proudly tell me that they have “exit strategies.” It seems to be that such details do notcreate a reason to be. The love of what you create and, hopefully, the rewards for building lasting brands, should be the end goal.

In my earlier years in the industry, the term “exit strategy” was never a consideration in planning. Those were exciting times: it seemed that people got into it for the love of creating and bringing a product to market. Of course, they were also in it to make money, as they should have been, but that wasn’t their only vision. I watched dozens of brands come into being, and many of them now form the gold standard of the new beverage business. Never did I hear Don Vultaggio, Jim Koch, Darius Bikoff, Mark Hall and Rodney Sacks, Lance Collins, Seth Goldman, or too many others to list brag about building in an exit strategy. The list is not limited to the big guys, but many small players that comprise long-term, sustainable brands as well: the Talking Rains. National Beverages and Calypsos of this world are to be admired just as much as the celebrities.  While the possibility of a sale may always sit at the back of one’s mind – after all, we all have a price – it was never a consideration in the quest for innovation for many of those I just named. They didn’t use the sale of the company as the ultimate yardstick for success.

While many of them ultimately did sell, it doesn’t preclude why they jumped in, and the passion they exuded.

I love the new generation of marketers for their innovativeness, their intent to serve consumers with healthy, good for you brands. They are creative, thoughtful and have high aspirations. I just wish I could hear more soul in the reasons they are entering the marketplace. The beverage industry is not for the faint of heart. If you’re in, do it for the right reasons. It’s nice to be rewarded for your work, but having as part of your ultimate goal an exit plan based around a big payout is not the way to go.