PE Alpha - Page 2 of 13 - PE - Getting an Edge & Superior Risk-Adjusted Returns

Navigating Key Issues in PE – What Has Changed in 3 Decades

Private equity has expanded significantly over the past three decades, with fund counts and AUM reaching record levels. As competition increases and financing costs rise, PE firms must rely more on GTM Improvements (Profitable Revenue Growth Acceleration) combined with Operational Improvements to generate returns. Number of PE Funds up 5x… Read More >

PE Value Creation – The Mission of the Operating Partner Role

Here’s the core purpose of the GTM Operating Partner role in PE: Mission of the Role Own GTM value creation: Lead all commercial excellence aspects of Value Creation Plans (VCPs) from diligence through exit Support deal teams: Surface hidden GTM value opportunities in diligence, shape VCPs, and own execution post-close,… Read More >

PE Value Creation – the ROI of an Operating Partner (via TEV uplift)

The ROI of a PE Operating Partner: How the Numbers Work The Operating Partner is one of the most effective value creation players drivers in PE. At a PE International Nexus conference earlier this year, an institutional LP noted: “To generate a 10x return on an Operating Partner’s compensation (i.e.… Read More >

Key insights – The Future of Private Equity Investing is all about PAOVA (Post-Acquisition Operational Value Add)

Key insights from the Partners Capital whitepaper on The Future of Private Equity Investing is all about PAOVA Post-Acquisition Operational Value Add (PAOVA) is becoming the critical differentiator between alpha-generating and alpha-detracting sponsors Past PE returns were boosted largely by falling rates, leverage, and multiple expansion rather than… Read More >

PE – CEOs & Cultural Fit (the most underestimated risk in middle-market CEO recruiting)

When we hire CEOs in PE, culture fit is one of the most underestimated challenges in. Even if the CEO has the right PE grade “functional skills” and operational expertise, if they clash with the company’s culture or fail to align with the team’s dynamics, it’s a recipe for disaster.… Read More >

Assessing the Company’s Scalability During GTM Diligence

Scalability – Assessing a Ptential Investment’s Scalability During Diligence (for Middle Market Companies) In software (for Tech PE buyouts), the margin between success and mediocrity hinges on accurately assessing scalability before writing the check. While revenue growth captures headlines, PE investors know that sustainable unit economics, operational leverage, and… Read More >

PE Deal Process: “One Team” with Deal Teams & Operating Partners

“One Team” Strategy in PE: How the Investment Team & Operating Partners Work Together as a “Deal Team” by Stage of the PE Deal Process 1. PE Firm Receives Teaser (then CIM) Investment Team Initial screen for investment alignment (sector, growth, profitability, valuation) Preliminary internal discussion on deal… Read More >

What Defines a Strong CRO in Middle-Market PE

In PE, profitable growth drives 50%-70% of equity value creation and directly impacts ROI to LPs. A strong CRO is critical – a proven operator with execution discipline, strong leadership, and a track record of driving predictable growth. They drive predictable growth, manage complexity, and execute the investment thesis to… Read More >

PE Value Creation 2.0: Helping Maximize IRR through Better Diligence & Ownership

We are in the new era of “PE Value Creation” that we can affectionately refer to as 2.0. Now it’s much more about better diligence & ownership than ever before. In the far more competitive world of PE, achieving superior risk-adjusted returns hinges on better diligence (which is surprisingly possible)… Read More >

PE Industry in 2023 (& 2024 Outlook)

Just wanted to reflect on this year – here’s a concise overview of the private equity (PE) landscape and strategic insights for navigating it: The resilience of the PE industry, even amid a slowdown, underscores the critical role of value creation and revenue growth for investment success. To stimulate deal… Read More >

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