Private Equity
Performance Advisors works with Private Equity firms and other investor groups to improve the financial performance of their portfolio companies. We assess “Stakeholder Relationship Networks” and develop performance improvement strategies that are measurable and visible to business owners.
In addition to the services and benefits outlined on the Corporate Performance page, our client’s can improve sustainable growth rates and investment returns through our customized simulation models that enable:
- Better Operating Performance
During periods of ownership transfer and management transition, there is increased risk of employee turnover and distracted and/or disloyal behavior on the part of employees in the acquired business. Since the new ownership team is generally not intimately tied to the existing operating team, the loyalties and performance behaviors of incumbent employees may remain disoriented for at least a year or two post-transaction.
When relationship network assessments are performed as part of the due diligence process pre-acquisition, it is possible for the new ownership team to more accurately assess strengths, weaknesses, opportunities and threats. By discovering these issues pre-acquisition, it is possible to more accurately value (and negotiate) the “goodwill” portion of the transaction purchase price. It is also possible to begin post acquisition integration or transition planning well in advance of the closing date.
Clearly, the better informed and prepared the new team is regarding the existing relationships among stakeholders within the target company and through the extended enterprise and marketplace, the greater the ability to navigate change and achieve outstanding results. Further, by “institutionalizing” the knowledge and business relationships of the employees and management team, there is less dependence on these employees and greater ability to maneuver during economic downturns or other competitive threats.
- Better Navigation in Competitive Environments
While firms and their professionals have advanced knowledge of finance and deal structure matters, there are often strategic insight gaps regarding the competitive environment surrounding portfolio companies.
Certainly operating management teams have experience in their traditional operating environment and with their traditional competitors. However, there are often “blind spots” in today’s face paced environment that create serious financial risk for investors.
Marketplaces are evolving globally and non-traditional competitors are taking greater market share. There is a need for better decision support & analysis perspectives to improve the agility of portfolio companies. These perspectives also help leadership teams and investors to navigate through dynamic and competitive environments.
- Better Return on Relationships
Commonly referred to as “Proprietary Deal Flow”, we enable firms to harness and commercialize private relationships with their partners, LP’s, principals, management teams, and even portfolio company employees. When strategic relationship assessments are centralized in planning and development efforts, then it is far less likely that targeted companies will be reduced to auction tactics during the ownership transfer process.
Please Contact Us for more information and for a complementary stakeholder relationship network assessment.