3 Alternative Ways to Exit Your Business for $500K -- $5 MillionNavigate a successful -- and realistic -- exit with these approaches.

We all hear about the entrepreneurs whoexitedtheir company for life-changing sums of money. Go and talk to your local high-net-worth wealth advisor and you'll discover that many of their clients made their fortune when their company was acquired.

Those are great stories, sure, but the reality for most businesses is that you can't sell them for one big lump of money, especially if they are worth between $500,000 and $5 million.

For starters, other entrepreneurs will notbuy your businessfor over $500,000. Entrepreneurs typically believe they can compete with you and rather than spending half a million or more to buy your business, they'd rather spend it on creating a competitive product or growing their own business. Additionally, entrepreneurs are rarely cashed up; if they do have spare money they rush off and buy houses with it.

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Big companies have big lumps of cash to go and buy businesses but they don't typically do deals for less than $5 million. Normally acquisitive companies are publicly traded or are backed byprivate equity funding; either way, they need to report back to an army of stakeholders who want to see piles of supporting documentation on why any acquisition was made.

This means acquisitions are typically "mandated by the board of directors" to be a minimum deal size. A very small mandate would be $5 million but most big businesses want to spend at least $20-100 million on an acquisition considering it's roughly the same amount of work to buy either.

Most entrepreneurs are a long way from selling their business for $5 million or more, but they also don't want to sell it for less than $500,000. Here are three alternative arrangements for selling a small business that is valued somewhere in-between.

Exit 1: The Mini Cash Cow

This exit is not about selling your business but rather exiting yourself from the day-to-day operations of the business. You'll probably need to scale the business back to a small core team (typically 6-12) and focus on the profitable and repeatable work that you're best at. If you get your business running in a way that only requires you to do one or two days a month and still pays you a decent income, in a way you have exited the business.

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Exit 2: The Mini MBO

If you have a small team of managers working inside the business already, you can explore a management-buy-out (MBO). In this deal, two or three of the people who already know the business purchase the controlling shares and take over its ownership.

For small businesses that can't access independent funding to complete this deal, you might be required to sell down your shares over 2-5 years at a rate the business can afford. For protection, you can structure this deal like a loan and putdebenturesover the business for security. It's not the big lump sum you hoped for but at least you can't go and blow it all on a yacht that you'll regret later.

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Exit 3: The Mini Merger

If you go looking, you might discover a competitor or complementary business who's in a similar position to yourself. Both of you are too small to be bought by a bigger company but together you're the right size. In this deal, you would "bolt together" two or more businesses and get them working as one, and then approaching larger companies for a cash exit. Rather than having 100% of a business that can't be easily sold, you might find yourself with 35% of a business that sells for millions.

To achieve any of these alternative exits you will need an experienced business coach, accountant and lawyer who each has a track record of getting businesses into the right shape.

Be warned though, entrepreneurs are notorious for only lasting 3-6 months before going off to start something new!