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. a PE firm’s investment in the role), they only need to help create $1M of incremental EBITDA annually across the portfolio. At a 10x valuation multiple, that equates to $10M in additional enterprise value.”

For most PE firms (even with as few as 10 active portfolio companies), this is both realistic and attainable. In practice, the potential impact is far greater, with many Operating Partners able to drive multiple millions of incremental EBITDA, translating into significantly more than a 10x+ ROI on the role. It’s a clear value proposition for the role.

The ROI of a PE Operating Partner: 

Scenario 1: $1M EBITDA uplift 

  • Just $1M EBITDA created across the portfolio
  • At a 10x multiple = $10M TEV
  • ROI = $10m / Role Investment

 

Scenario 2: $5M EBITDA uplift

  • $5M EBITDA created across the portfolio
  • At a 10x multiple = $50M TEV
  • ROI = $50m / Role Investment

 

Scenario 3: $10M EBITDA uplift

  • $10M EBITDA created across the portfolio
  • At a 10x multiple = $100M TEV

 

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I. One Way to Think About ROI: Revenue Growth Contribution

An Operating Partner focused on GTM / Commercial Excellence impacts revenue growth across the entire portfolio.

Simple Baseline Scenario – $1M incremental EBITDA impact:

  • If the OP contributes $5M in incremental revenue portfolio-wide through GTM improvements
  • At a 20% EBITDA margin, that equates to $1M in incremental EBITDA
  • At a 10x EBITDA multiple, the TEV uplift is $10M
  • ROI = “$10M ÷ PE Firm’s Investment in Operating Partner Role”

For an experienced Operating Partner specializing in GTM, achieving this level of revenue uplift is a realistic and repeatable outcome.  This can be done with many GTM levers including pricing optimization, more effective sales strategies and processes (boosting win rates, increasing deals, and growing total sales) – making the ROI math (10x+) both straightforward and high conviction for the GP and LPs.

II. Another Way to Think About ROI: Cost Efficiencies 

If an Operating Partner impacts portfolio-wide cost improvements and efficiencies (through operational improvements) helps cut just $1M which contributes this to incremental EBITDA, the math is straightforward:

  • $1M EBITDA uplift × 10x multiple = $10M TEV increase

That’s a 10x ROI on cost efficiency initiatives.  Unlike one-off consultants, the Operating Partner continuously drives revenue uplift, EBITDA expansion, and operational improvements across the entire portfolio, magnifying ROI many times over.

 

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ROI Takeaway: Even modest uplift creates double-digit ROI. At scale, the Operating Partner role routinely delivers 10x – 30x+ ROI relative to a PE firm’s investment in the role, reflected in portfolio-wide TEV uplift. Early gains at the “Scenario 1” level are often possible within 6 – 8 quarters, with “Scenario 3” outcomes (30x+ and higher) achievable over the full investment horizon.