| Private Equity

The Importance of Brand in a Post-M&A Scenario

Mar 16, 2020 1:08:48 PM | Posted by The Chief Outsider

Winning the Brand Game Can Supercharge Your M&A Results

For acquirers of businesses, either Corporate or Private Equity (PE), it’s not exactly a great time to be buying businesses and placing bets on new frontiers. A recent Price Waterhouse Coopers report found that the uptick in mega-mergers and acquisitions seen in 2019 will continue into the new decade. This means high purchase prices will remain in their stratosphere for the foreseeable future.

As a result of high purchase-price multiples and overly ambitious revenue growth plans, the landscape is littered with the remains of deals gone south or sour. In fact, more than half of intended acquisitions fail, and 80 percent fall short of expectations. To protect themselves against failed deals, Corporations and PE have responded to inflated purchase price multiples by doubling down on pre-acquisition and pre-merger due diligence.

Read More

3 Keys for Increasing Odds of M&A Success

Feb 17, 2020 10:59:00 AM — Solid due diligence on ALL aspects of the business and a fast start on value creation are needed to reach the end-point of a strong ROI for the investors at exit Recently, I was visiting with a colleague from my days at Waste Management Inc. (WM) reminiscing about a major industry roll-up of which we were a part. Waste Management had decided to create value for shareholders by acquiring and consolidating companies in the very fragmented pest control and lawn care business, creating new national players in the industry. We were part of the acquisition team – several of us having been owners of acquired companies, plus a long-time WM executive. In two years, our team directed the acquisition and consolidation of over 150 companies, resulting in a roll-up of about $200 million in annual home services revenue. The entire consolidation was eventually sold to ServiceMaster, owner of Terminix. Fast forward to current days, when many of the old problems with M&A are the same, but there’s a new twist. In the world of Private Equity, today’s sky-high valuations require making even smarter decisions when buying a company. Solid due diligence on ALL aspects of the business and a fast start on value creation are needed to reach the end-point of a strong ROI for the investors at exit.

Weatherproof Growth

Jan 24, 2020 10:55:28 AM — Every company operates within its own economic cycle, defined by internal and external pressures and trends that apply to them exclusively. Understanding where a business is in its own cycle is key for PE firms to properly value and grow the enterprise, according to Paul Sparrow of Chief Outsiders. From the headlines, these are good times with plenty of clear weather and money-making sunshine. Marquee stats from the major stock exchanges and quarterly job reports tout an unprecedented economic expansion, despite cautionary signs like last year’s inverted yield curve. But a deeper dive into individual sectors and more specific economic metrics complicates that rosy forecast.

Portfolio Company Marketing at the Speed of Now

Oct 28, 2019 4:50:31 PM — Several trends in the private equity landscape demand GPs focus on accelerated growth initiatives to drive returns, which requires an infusion of marketing expertise, says Karen Hayward of Chief Outsiders. Private equity’s long boom is proving to be mixed blessing. According to Prequin, deal making through the third quarter of 2019 is matching that of 2018. GPs are still raising record levels of capital, meaning the competition for deals, reflected in the high price of assets, won’t be subsiding anytime soon. More concerning is that the pace of exits has been slowing, with 2019’s exits looking to fall short of 2018’s numbers, a situation that has yet to dampen LPs enthusiasm for the asset class… yet.

The Next Wave of PE Growth: Using Data to Optimize Emotional Connections

Sep 25, 2019 2:35:29 PM — There are many examples in today’s market of PE firms rapidly helping their midmarket brands implement digital strategies to improve customer experiences. By leveraging scale and best practices, these PE firms help their portfolio companies implement operational efficiencies and marketing efforts that influence consumer purchase behavior, driving higher topline growth leading to higher valuations.

Private Equity Blog

The Importance of Brand in a Post-M&A Scenario

Winning the Brand Game Can Supercharge Your M&A Results

Recent Posts

3 Keys for Increasing Odds of M&A Success

Weatherproof Growth

Portfolio Company Marketing at the Speed of Now

Stay up-to-date with the latest from Chief Outsiders

The Next Wave of PE Growth: Using Data to Optimize Emotional Connections

With CMOs located: