Which of the following is NOT a common exit option for entrepreneurs?

• A. Acquisition
• B. Initial public offering
• C. Franchise sale
• D. Management buyout

Answer: (C)

The key idea here is what counts as an exit: a way for the owner to cash out or transfer full control of the entire business. The usual exit paths are selling the whole company to a third party (acquisition), taking the company public (initial public offering), or transferring ownership to the existing management team (management buyout). Each of these ends the founder’s day-to-day involvement and provides liquidity or new ownership for the entire enterprise.

Franchise sale, on the other hand, is a growth strategy tied to expanding the business model by granting franchise rights to others. Selling a single franchise or the right to operate under the brand doesn’t exit the original owner from the entire business; it creates more units under the same company structure. So it isn’t a typical exit path for an entrepreneur, which is why it’s not considered a common exit option.