Exit drought
A period of reduced exit activity, often associated with valuation gaps, financing conditions or limited initial public offering (IPO) opportunities. Holding periods may lengthen and distributions may slow without every potential buyer disappearing.
Exit drought in round numbers
Hypothetical: a sponsor planned an exit in year 5 but still holds the company in year 8. This is a three-year extension beyond the plan, not an actual exit in year 8. Continued ownership requires reassessing valuation, liquidity and the available routes to realization.
Scroll horizontally to read all columns.
| Point in time | Status |
|---|---|
| Year 0 | Investment made |
| Year 5 | Planned exit date |
| Year 8 | Still held; three years beyond plan |
Terms Related to Exit drought
DPI · J-curve · Fund life · Exit (harvest) · Buy to sell · All of the glossary