**Expanded Exit Strategy**
---
### **1. Acquisition by International Chains**
**Rationale**: Global pizza chains (e.g., Domino’s, Pizza Hut) entering Ethiopia will prioritize acquiring established local players to bypass market-entry risks.
**Preparation**:
- **Valuation Metrics**:
- **EBITDA Multiple**: Target 8–10x EBITDA (Year 3 EBITDA: 10M ETB → 80–100M ETB valuation).
- **Brand Equity**: Themed dining concept, loyal customer base, and local supplier network add 30% premium.
- **Strategic Positioning**:
- **Scalability**: Highlight 10-location expansion blueprint (2030 vision).
- **Tech Integration**: Showcase POS systems, delivery apps, and loyalty program as turnkey assets.
- **Target Buyers**:
- **Domino’s**: Aggressive African expansion (30+ stores in Egypt, 20+ in Kenya).
- **Pizza Hut**: Parent company Yum! Brands seeks franchising partners in high-growth markets.
- **Regional Players**: Dubai-based *PizzaExpress* or South Africa’s *Debonairs Pizza*.
**Process**:
1. **Year 3 Readiness**: Audit financials, streamline operations, and patent recipes/IP.
2. **Engage Advisors**: Hire *Deloitte East Africa* for M&A brokerage.
3. **Negotiation Leverage**: Use competitive bids from multiple chains to maximize sale price.
---
### **2. Franchise Licensing Model**
**Launch Timeline**: Post-Year 3, after proving profitability at flagship locations.
**Franchise Package**:
- **Fee Structure**:
- **Initial Fee**: 5M ETB/license (covers training, branding, and site selection).
- **Royalty**: 8% of gross sales + 2% marketing fee.
- **Territory Rights**:
- **Dire Dawa**: Tourist corridor to Harar.
- **Hawassa**: Lakeside tourism hub.
- **Bahir Dar**: UNESCO site traffic.
- **Support Systems**:
- **Training Academy**: 4-week program for franchisees at Bole HQ.
- **Centralized Supply Chain**: Pre-negotiated rates with Bahir Dar Farms/Awash Milk.
- **Tech Platform**: Shared POS, delivery app, and loyalty program.
**Financial Projections**:
| **Metric** | **Per Franchise (Year 1)** | **10 Franchises (Year 5)** |
|--------------------------|----------------------------|----------------------------|
| Avg. Revenue | 12M ETB | 120M ETB |
| Royalty Income (8%) | 960,000 ETB | 9.6M ETB |
| Franchise Fees (5M each) | N/A | 50M ETB (one-time) |
**Risk Mitigation**:
- **Performance Clauses**: Revoke licenses for underperforming franchises (<70% sales targets).
- **Brand Compliance**: Mystery shoppers and quarterly audits.
---
### **Hybrid Exit Options**
- **Joint Venture (JV)**: Partner with a chain (e.g., 60% Domino’s, 40% Boaz) to retain influence.
- **Management Buyout (MBO)**: Offer equity to senior staff at 20% discount.
---
### **Valuation Drivers**
1. **Market Penetration**: 10% share of Ethiopia’s $3.5B F&B sector.
2. **Recurring Revenue**: Franchise royalties and catering contracts.
3. **Cultural IP**: Trademarks, *teff* crust recipe, and “Island Night” concept.
---
### **Investor Liquidity Pathways**
| **Exit Route** | **Timeline** | **Return Multiple** | **Key Triggers** |
|-----------------------|--------------|---------------------|--------------------------------------|
| Acquisition | Year 5–7 | 4–6x | Global chain enters Ethiopia |
| Franchising | Year 4+ | 3–5x | Flagship EBITDA >15M ETB |
| IPO | Year 8–10 | 7–10x | Ethiopia’s stock market liberalizes |
---
### **Why This Works**
- **Acquisition**: Leverages Ethiopia’s untapped market potential to attract global buyers.
- **Franchising**: Capital-light scaling with recurring royalties (20%+ IRR for Boaz).
- **Flexibility**: Dual options ensure liquidity even if one path underperforms.
By Year 3, Boaz will be positioned as Ethiopia’s most acquisitive or franchise-ready pizza brand—offering investors a buffet of lucrative exit opportunities. 🚀🍕