Don’t miss tomorrow’s session featuring Falcon’s Rob Huxtable. Our team is looking forward to a great discussion on commercial leadership in private equity-backed companies.
Excited to moderate this session this Wednesday at the PEI Human Capital Forum. Commercial leadership searches are among the most persistent recruiting challenges for PE-backed companies, and the pressure is only mounting. Bain's annual PE report makes the math plain: due to multiple compression and leverage constraints, what used to require 5% annual EBITDA growth to deliver a 2.5X now requires 12%. Knowing M&A will absorb some of that burden, our sponsor clients tell us they need to figure out how to drive portfolio company growth of 7 to 9% organically going forward. A slow year in tech, a much bigger lift for the broader market. To help diagnose the underlying issues, FALCON and PrivateEquityCXO ran a sentiment analysis of 245 sitting portfolio company executives across the C-suite. Among several findings, the data confirmed what most sponsors already feel: the mean effectiveness rating for commercial functions across active PE-backed companies is 3.1 out of 5. Only 8% rated their commercial function best-in-class. And the data shows the burden is shared. The issues do not sit solely at the commercial leader's feet. It is a management team and sponsor challenge. That calls for a management team and sponsor solution, paired with a fantastic commercial hire. Looking forward to a candid conversation with Kate Griffin, Katie Kitchen (Mackin) and Pete Winningham on what top-quartile talent teams are doing differently to profile, find, assess, and land the right leaders for these high stakes roles. For anyone interested in our proprietary sentiment analysis, pls DM, text or email me.