Working with the leading consulting partners to the private equity industry across the entire investment life cycle, from deal generation and due diligence to portfolio value creation, along with some of the most prominent institutional investors, including sovereign wealth funds and family investment offices.
Immediately after acquisition can be one of the most crucial times, this is where Sarah assists both portfolio company and investor with post completion alignment and pursuit of returns. After what is likely to have been an emotional process for all parties it is vital that the key stakeholders have clarity on the next step in their journey, which done correctly will be mutually advantageous. Having a plan is one thing, execution is another and Sarah’s process increases the likelihood of success which is ultimately what drives passionate management, returns for investors and a successful investment.
During the ownership phase, continual support can increase the value of a portfolio company.
For a private equity backed CEO, there is the added challenge of creating value in a compressed time frame.
In addition to protecting value, the board expects the CEO to create value – and quickly. Often under pressure, clarity and focus gets lost, spending too much time in the present - fire fighting and crisis management can mean losing sight of shaping and creating the vision for the future.
For many board and executive teams taking on investment from a private equity (PE) firm, the board represents one of the biggest areas of change and in some cases challenge and anxiety.
In my experience of supporting company board teams and PE firms over recent years in the performance area, getting the new board team off to a strong start represents a critical foundation of a successful partnership with your new PE investors.
Research by McKinsey has shown a strong correlation between high-performing PE portfolio board teams and out-performance of PE portfolio companies at the exit stage. The board of directors represents the critical formal interface through which a PE team partners with a company and the successful performance of a highly effective board team is a cornerstone of the PE model.
In practice, many CEOs, executive teams and existing board teams find the transition to a private equity portfolio board paradigm quite daunting and CEOs, in particular, have often found the first board meeting post investment to feel very much a "the honeymoon is over” moments after the highs of closing the deal.
Prior to taking on PE investment, many company boards, particularly those with CEO founders still in place, would have had executive-centric boards where the chairs and independent non-executive directors would very often be reluctant to challenge the CEO and executive team.
In many cases the CEO and executive teams are not used to tough constructive challenge from non-executive board members. They are also, in many cases, not used to those same non-exec directors who bring tough oversight also bringing significant independent thinking to the table.
Individuals start operating in their primitive brain - so logic goes out of the window and now all of this can feel threatening. You see negative reactions that are created purely from fear and you often see resistance and on occasion conflict.
This also clouds thinking and judgment and leads to bad decisions.
A specialist can enhance the efforts of the CEO and get them back operating in their Cortex, the part of the brain involved in logic. Required to remain rational, and necessary for strategy and planning to help move forward.
Translate intangible leadership complexities into real business results.