Liquidity/Exit

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In the world of entrepreneurship and venture finance, exit refers to a liquidity event, in which owners of illiquid stock in a privately-held company – whether they be founders, employees, or investors – achieve liquidity for their stock holdings (i.e., a market develops for their shares where no market previously existed) due to one of two occurrences: a) the company “goes public” through an initial public offering or IPO; or b) the company is sold to another company, either for cash or for the publicly traded stock of the acquiring company. (see also: shareholder exit, liquidity, and liquidity event).

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