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The Anatomy of a Durable Commercial Engine
The New PE Value Creation Playbook: Part Three
The Anatomy of a Durable Commercial Engine
"Private equity firms will have to work harder in order to deliver superior returns." — Bain & Company
If private equity firms want portfolio companies to create durable value, they need to look beyond individual growth tactics and assess the commercial engine itself.
Most portfolio companies are not standing still.
PEI 2018 Operating Partners Forum Recap: Growth Guidance Role Becoming More Strategic
Oct 30, 2018 1:28:01 PM — The two key messages from the PEI Operating Partner forum came through loud and clear this year: Every PE firm needs an Operating Partner strategy. The structures vary, but LPs now insist that someone is covering the role. As the Operating Partner role has become more strategic for PE firms, the focus of the role has matured from cost cutting to sales effectiveness and now onto supporting and driving commercialization and Big M strategic Marketing. I have attended 5 of the last 6 PEI Operating Partner Forums. During that time, I have seen the role of Operating Partner change significantly. When I first started attending, Operating Partners (OPs) were evolving from cost-focused executives in residence to starting to work with Deal Teams on Value Creation Plans. At that time, being involved in fund raising and participating in LP meetings was an aspiration.
It’s Not Just About EBITDA Anymore
Apr 30, 2018 1:02:33 PM — EBITDA is not just one of our favorite acronyms in the Private Equity world, it’s the basis of value. Purchase prices are based on EBITDA and sale prices are based on EBITDA. Operating Partner groups and Resource groups came into existence a few years ago because PE firms recognized that they could add resources and expertise to help their portfolio companies grow EBITDA and earn a better exit.