E Co. bites: What is an exit strategy?
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Speaker: Alex Milano
Question: What is an exit strategy?
The exit strategy is essentially a description of how a funded project will be brought to a close while sustaining the benefits. Having an exit strategy is essential in many donor-funded projects such as the GCF, GEF and Adaptation Fund. Even if funders don’t require it, it’s a good idea to include it.
The description of the exit strategy should provide a logical explanation of how the project will ensure two types of sustainability: internal sustainability and external sustainability. Internal sustainability is a question about how the benefits delivered by the project will continue to be delivered after the end of the project.
External sustainability means the scale-up of services so that other’s also benefit from the project results without the funder providing additional resources. This type of sustainability can significantly strengthen the motivation of the donor to fund the project.
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