The era of cheap capital is over. Now, more than ever, returns are becoming increasingly reliant on operational execution and value creation, driven by management teams and talent in portfolio companies. This puts a much higher emphasis on hiring a deeper, broader pool of talent and having the right organizational architecture in place to enable high-performance execution from the jump – and right now firms that are able to demonstrate operational value creation are being held in much higher esteem by allocators.
The most important part of diligence that nobody is talking about
Management team effectiveness remains the single most important factor determining the success of a private equity investment, writes Samhita AP Jayanti, founder of Ideamix Coaching.
