This qualitative study explores why and how entrepreneurs develop exit strategies. The study is situated solely in the biopharmaceutical industry in the United States and Canada. Ten founding biopharmaceutical entrepreneurs completed background questionnaires and participated in semi-structured interviews. Data were analyzed using the methods of thematic analysis facilitated by the use of Atlas.ti. The study finds that all biopharmaceutical entrepreneurs developed strategies for their investors, but consistent with prior research less than half developed personal exit strategies. This study also found that the source of funding may impact whether or not exit strategies are developed. Entrepreneurs explained that the infrequent use of personal exit strategies was due to perceived low value of strategizing in this industry with limited exit options, combined with uncertainty and the need for flexibility, rendering exit strategies ineffective. In exploring how biopharmaceutical entrepreneurs develop exit strategies, the study identified five impactful components of the process: the entrepreneur’s motivation to start the venture, his or her personal exit intention, building business value through innovation, the entrepreneur’s psychic income, and effectuation logic. The researcher offers a model of this process. Though the sample size is small, this study provides valuable information for aspiring entrepreneurs and offers intriguing questions for future research.
Key words: Biopharmaceutical, biotechnology, entrepreneur, exit, exit strategy