The Private Equity Podcast, by Raw Selection

Introducing Carl Cox

Carl J. Cox is a Business growth strategy expert, podcast host, and the CEO of 40 Strategy, where he helps CEOs scale with strategic excellence. He is also the author of Lost At CEO: An Entrepreneur's Guide To Strategy. The book reveals a uniquely different approach to strategies that have the power to transform any business that has struggled with stale strategic retreats, failed initiatives, and stalled-out growth. 

What You Will Learn:

The Power of Strategic Planning in Private Equity

How to Design a World-Class Strategic Plan

Ways to Move From Lagging to Leading Indicators

Breakdown:

[00:00] Introduction

[01:50] The Mistakes PE Firms Make with Their Portfolio Companies

[02:49] Marrying People, Processes, and Systems in a Firm

[04:14] From Lagging Indicators to Leading Indicators

[06:47] Indicators That Prove You're Headed in the Right Direction

[08:53] Strategies and How Often to Track Your Them

[12:10] The Concept of Strategic Accountability

[15:29] What a World-Class Strategy Looks Like

[19:25] Motivation For Writing the Book

[23:30] What Carl Likes and Dislikes About Private Equity

[28:57] What Carl Watches, Reads, and Listens To 

[33:02] Parting Thoughts 

The Foundations of a Strategic Plan in Private Equity

Ready to scale your private equity firm the right way? Well, it's very simple. All you need is a world-class strategic plan and the accountability to get it done. According to Carl, all these can be achieved by focusing on only three things:

1. Initiatives that Create Value. As a PE firm, you must focus on the initiatives that create the most value. Highlight all potential strategic initiatives, then rank them according to feasibility, and double down on the ones that have a greater organizational impact. To improve your chances of success, Carl recommends focusing on at most three strategic plans at a time.
2. The Right KPIs. Choose KPIs that are leading indicators, not lagging indicators. Stop focusing on the outcome and instead focus on the behaviors that lead to them. A solid strategic plan should have metrics for behaviors and actions that can be tracked and monitored regularly. 
3. Accountability. PE firms should make accountability a core part of their business strategy. Keep your people accountable. Don't take your eye off the ball because people will likely fall back into old habits. As a leader, start by setting clear deadlines, establishing roles, and performing regular check-ins. The more successful PE firms ensure everyone stays on track and feels more accountable for their work.

How to Carl Cox

Carl's email - [email protected]

Carl's LinkedIn, 40strategy.com, Lost At CEO: An Entrepreneur's Guide To Strategy
by Carl J. Cox 

Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.
Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Introducing Matthew Garff

Matthew Garff is the Senior Managing Director at Sun Capital Partners, Inc. - a private investment firm focused on investing in middle-market businesses. Sun Capital's portfolio includes approximately 35 businesses across multiple sectors, with over 400 acquisitions since the late '90s.

What You Will Learn:

Culture as The Key to Success in Private Equity

The Problem with the Low Barrier to Entry in Private Equity

Private Equity Deal Scarcity

Breakdown:

[00:00] Introduction

[01:40] The Mistakes PE Firms Make with Their Portfolio Companies

[02:38] How Sun Capital Measures Company Culture

[05:15] The Link Between Great Cultures and PE Success

[07:32] Current Trends in Private Equity

[11:46] What the Best Firms Do to Create Value in Portfolio Companies

[15:53] The Role of PE Firms in Their Portfolio Company's Success

[18:35] Deal Team and Portfolio Team Working Together

[21:11] What's Driving Deal Scarcity in Private Equity

[25:58] Biggest Lessons in Matthew's Career

[28:02] What Matthew Likes and Dislikes About Private Equity

[29:53] The Low Barrier to Entry in Private Equity

[31:30] What Matthew Watches, Reads, and Listens To 

[25:53] Parting Thoughts

How Culture Impacts Private Equity Success

Is company culture important for making successful PE firms and portfolio companies? According to Matthew, the culture within a company plays an important role in the performance of that company. Companies with great cultures often translate to better returns for investors. Companies with not-so-great cultures rarely get the intended results for their investors. Unfortunately, culture can often be an afterthought in PE. So, how can you build great cultures in your company? It all starts with getting the right people in the right positions. Firms with the right people are more likely to build a great culture. This, in turn, benefits the firm by embracing a forward-thinking approach—which is often a common predictor of financial success.

How to Contact Matthew Garff

Matthew's LinkedIn

Suncappart.com

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Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Introducing Pranav Garg

Pranav Garg is the Founder and Head of Product at Peak Margins, a firm focused on helping B2B companies turbo-charge profitable growth. Their analytics solution taps into ERP data to give companies a transformative view of growth and profitability by customer, product, salesperson, channel, territory, and more.

What You Will Learn:

How to Drive Profitable Growth in Private Equity

The Power of Data in Deal Sourcing and Decision-Making

The TAU Framework For Profitable Growth in Private Equity

Breakdown:

[00:00] Introduction

[02:28] The Mistakes PE Firms Make with Their Portfolio Companies

[05:48] Most PE Firms Don’t Know How They Make Money

[09:31] Thinking About Profitable Growth

[11:26] Understanding the Drivers of Profitable Growth in PE

[14:02] The First Step to Working with Data in PE

[17:38] Pranav’s TAU Framework For Profitable Growth

[20:12] How to Implement the TAU Framework in PE

[23:20] The Advantages of Data-Driven Decision Making

[26:26] What Pranav Likes and Dislikes About Private Equity

[28:40] What Pranav Watches, Reads, and Listens To 

[32:24] Parting Thoughts

The TAU Framework For Profitable Growth

Why is data critical in running a profitable PE firm? According to Pranav, firms that don’t use data often go with their gut feelings, intuition, or external pressures to make decisions. The problem with this is an over-reliance on the skills and experience of the team. This means that processes stop being easily repeatable, and outcomes are now sorely reliant on luck. But with the TAU framework, you can change all that.

●        T - Transparency: You need to have a single source of truth. Get good enough data that your team stops complaining about just how bad the data is. 

●        A - Accountability: The two most important parts of accountability are incentives and tracking. You need to offer incentives to your people to motivate them to do their jobs better. You also need a way to track the actions you take - and this can be as simple as using a spreadsheet.

●        U - Urgency: Make your profitability actions urgent. Keep them at the center of everything you do daily, weekly, monthly, and yearly. 

How to Contact Matthew Graff

Email on [email protected]

Peakmargins.com

Pranav’s LinkedIn

Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here. Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Introducing Tim Flannery

Tim Flannery is the Co-founder & CEO of Passthrough, a company focused on automating the subscription process for private funds. They make it easy to distribute subscription agreements to investors and have them executed electronically. The result is less time spent going back and forth, better compliance, and structured investor data.

What You Will Learn:

Investing in Your Firm's Brand For Long-Term Success

AI Use in Private Equity

How to Communicate Effectively with Your Investors

Breakdown:

[00:00] Introduction

[01:46] The Mistakes PE Firms Make with Their Portfolio Companies

[05:48] Fund Strategies and Proactive Communication

[06:45] The Benefits of Investing in Your Firm's Brand

[08:40] What Investors Really Want

[12:54] Straightforward Ways to Improve Brand Strategy

[15:18] Understanding the Fundraising Market

[17:07] Advice on Raising Funds

[21:22] Lessons From Succesful Fundraising

[22:56] What Tim Likes and Dislikes About Private Equity

[25:30] How Firms Are Using AI to Raise Capital

[25:30] What Tim Watches, Reads, and Listens To 

[25:53] Parting Thoughts

Why You Need to Invest In Your Firm's Brand

There is nothing quite as important as your brand when it comes to Private Equity investing. We live in a time when people will talk about you. Their investment decisions will be influenced by what they read about you on the internet and what other investors say about you. According to Tim, investing in your firm's brand is the key to achieving long-term PE success. A strong brand establishes credibility, fosters customer loyalty, and differentiates you from competitors. It's the first impression you make and the lasting memory you leave. In today's crowded market, a distinct brand is a powerful asset for driving profitable growth. By investing in your brand, you're investing in the foundation of your business's identity and ensuring a solid place in the market.

How to Contact Tim Flannery

Tim on LinkedIn

Passthrough.com

Tim's Email: [email protected]

Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Introducing Amy Gross

Amy Gross is the Global Private Equity Practice Leader for Liberty Mutual. She consistently demonstrates her expertise by working directly with clients connecting their firms and portfolio companies across Liberty’s global business. Amy brings the scale of her private equity clients to the forefront, where she educates on private equity and encourages people to bring creative solutions to help them solve their needs. 

What You Will Learn 

How to lower private equity insurance costs

Insurance for PE portfolio companies

Reasons why PE firms should prioritize insurance coverage

Breakdown

[00:00] Introducing Amy Gross

[01:40] The Mistakes PE Firms Make with Their Portfolio Companies

[04:12] Insurance Premiums for PE Portfolio Companies

[06:08] Is PE Too Risky For Insurance Firms?

[10:35] What PE Firms Can Do to Get the Most Out of the Insurance Industry

[13:02] Ways PE Firms Can Reduce Their Insurance Costs

[16:15] How to Build Better PE-Insurance Relationships

[18:38] What Amy Likes and Dislikes About PE

[19:47] What Amy Watches, Reads, and Listens To 

[20:28] Parting Thoughts

How PE Firms Can Lower Their Insurance Costs

Lowering private equity insurance costs can be challenging, as insurance premiums are typically based on factors such as the nature of the business, its operations, risk profile, and claims history. According to Amy, the biggest thing PE firms can do to reduce their insurance cost is to make themselves a better risk. A better risk involves actively reducing the impact of potential loss by developing plans to eliminate, manage, and limit setbacks as much as possible. All this translates not to just better insurance but better workplace safety, better morale, and basic peace of mind. Amy adds that building great relationships with insurance carriers can sometimes lead to better premiums. Demonstrating loyalty and maintaining a positive track record with an insurer can result in favorable negotiations and potentially lower costs.

How to Contact Amy

Amy’s email [email protected]

Libertymutualgroup.com

Amy’s LinkedIn

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Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Introducing Jon Thompson

Jon Thompson is the author of The Dashboard Effect and co-founder & Chief Strategy Officer at Blue Margin, where he helps private equity and mid-market companies quickly convert data into automated dashboards. Their mission is to deliver breakthroughs early and often, and within clients’ timelines and budgets. Jon offers practical steps for business leaders who want to quickly leverage data to improve outcomes.

What You Will Learn

How to Apply Data and Analytics in Private Equity

Why Data Intelligence is a Great Differentiator in Business

Ways Data is Slowly Transforming Private Equity

Breakdown

[00:00] Who is Jon Thompson?

[02:00] Common Mistakes by PE Firms and Their Portfolio Companies

[04:38] Data Analytics in Private Equity and Why It’s Important

[07:24] Successful Data Utilization in PE

[10:09] How to Make Data the Main Part of Your Execution Strategy

[12:32] Reliable and Scalable Data Architecture

[15:18] How to Use Data to Inform Your Decisions

[20:00] Using Data Internally to Define Key PE Metrics

[22:15] How to Create a Data Utilization Culture

[25:55] Improving Data and Analytics in PE

[28:57] Jon’s Go-To Self-Improvement Resources

[35:25] Parting Thoughts 

Successful Data Utilization in Private Equity

Private equity firms have recognized the immense potential of data utilization in enhancing their investment decision-making processes and driving operational efficiency. By harnessing the power of data analytics, PE firms can uncover valuable insights, identify investment opportunities, and optimize portfolio performance. Successful data utilization in PE involves leveraging various data sources, employing advanced analytics techniques, and fostering a data-driven culture.

Rapid growth and the birth of AI have heightened the importance of in-depth data and analytics. To compete, PE firms need high-quality technology solutions to sharpen their insight and streamline their workflows across the entire fund lifecycle. However, data is only as valuable as it is understandable and accessible. According to Jon, without an effective way to manage information, your data can very quickly become “noise.” And in some cases, noise is worse than not having the data at all.

How to Contact Jon:

Jon’s LinkedIn https://www.linkedin.com/in/jon-thompson-37282432/ 

Jon’s Email: [email protected]

Bluemargin.com

The Dashboard Effect Podcast: https://podcasts.apple.com/us/podcast/the-dashboard-effect/id1634065977 

The Dashboard Effect: Transform Your Company by Jon Thompson and Brick Thompson

Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Introducing Ryan Schlitt

Ryan Schlitt CEO & Co-Founder Aviditi Advisors, a premier, independent alternative advisory firm servicing global alternative investment managers and investors. Ryan has over 20 years of financial experience as a senior management member of the leading private placement/advisory groups at Donaldson, Lufkin & Jenrette, and Credit Suisse Securities. Before forming Aviditi, he had originated, executed, distributed, and been part of more than 325 capital raises, aggregating more than $480 billion.

What You Will Learn

The Private Equity Fundraising Checklist

Why Small Private Equity Funds Struggle Raising Capital

When to Start Worrying About Access to Capital

Breakdown

[00:00] Who is Ryan Schlitt?

[05:10] Common Mistakes by PE Firms and Their Portfolio Companies

[07:10] It’s Not When You Start, It’s When You Finish

[08:30] How to Prepare for Fundraising Success

[14:34] Why Some PE Firms Struggle to Raise Funds 

[18:07] Ryan Describes the Current Fundraising Climate

[22:28] Smaller Funds Struggling to Raise Capital

[25:56] Is Capital Moving Away from Private Equity?

[29:00] Future Trends in PE

[31:45] Ryan’s Go-To Self-Improvement Resources

[35:25] Parting Thoughts 

Fundraising in Private Equity

Private equity has been experiencing a robust fundraising environment with increased investor interest and significant capital commitments. According to Ryan, one notable trend has been the rise of larger fund sizes. Some firms have been able to raise increasingly substantial amounts of capital, with mega-funds (those with over $5 billion in commitments) becoming more common. Established private equity firms with proven track records have been particularly successful in attracting capital from investors.

However, that is not the case with emerging managers and smaller funds. Investors often prioritize track records and prefer investing in established firms with consistent performance. Although the industry continues to evolve, fundraising success still depends largely on factors such as investment track record, investment strategy, differentiation, and alignment with investor preferences.

How to Contact Ryan:

Ryan’s LinkedIn: https://www.linkedin.com/in/ryan-schlitt-889896a/

Aviditiadvisors.com

​​Ryan’s Email: [email protected]

The Smartless Podcast: https://www.smartless.com/

Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Welcome to the Private Equity Podcast Playbook Series. In this series, we'll dive deep into crucial private equity subjects and provide playbooks that you can use to grow your firm or portfolio company. 

Introducing Jay Goldman

Jay Goldman is the Co-Founder and CEO of Sensei Labs, a Conductor used by the world's top organizations to orchestrate their most critical transformations. Jay and his team enable project management, collaboration, data tracking, and knowledge management that modern organizations need to be successful. 

What You Will Learn

Sources of Value Creation in Private Equity

What it Means to Create Value in a Portfolio Company

How to Create Structure in Your Processes

Breakdown

[00:00] Introduction

[01:40] Value Creation in Private Equity

[03:51] What it Means to Create Value in Private Equity

[07:02] The First Step to Creating Value in an Asset

[09:15] How to Build a Value Creation Team

[12:15] Templates for an Effective Value Creation Plan

[15:00] How to Orchestrate a Value Creation Process 

[20:35] Playbooks and the Benefits of Having a Repeatable Checklist 

[23:43] Why Internal Communication is Crucial For Team Success

[26:54] Who Should Be In Charge of Value Creation?

[32:20] How to Build Out Checklists and Workflows

[35:19] Pros and Cons of Status Reporting

[36:55] Parting Thoughts 

Value Creation in Private Equity

What does it mean to create value? If you're looking at it from an enterprise value perspective, you have an asset as part of our portfolio, and paid $10 million for it. Then your goal should be to exit it at a multiple, say 30, 40, or 50 million dollars. This means you'll have to create some enterprise value before exiting that asset. Jay adds that value creation is no longer associated with firing people. Much has changed, and now more PE firms are determined to create value. Today, PE firms are focused on building better businesses by growing their ability to produce revenue, built on acquisitions, geographic expansion, repricing, or new product lines. However, this is not to say that cost reduction is not essential because it will always be a factor in almost every value-creation plan. But it is now less emphasized than it was in the past.

How to Contact Jay

Jay on LinkedIn

Senseilabs.com

The Checklist Manifesto: How to Get Things Right by Atul Gawande 

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Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Introducing David Sopp
David Sopp is the Senior Vice President of Business Development at Simply Beautiful Smiles (SBS), a dental service organization, owned by Sun Capital Partners. He and his team acquire, operate, and offer back-office services to general dentistry practices across the Mid-Atlantic area. They currently have 40 locations across five states. Before joining SBS, he was a private capital investor investing in private equity and sub-debt.

What You Will Learn 

Perspectives from Being an Investor and an Operator 

Acquiring Businesses at Attractive Multiples

The Attributes of Top Performing Investors

Breakdown

[0:50] Introducing David Sopp

[3:58] What Made David Shift from Investor to Operator 

[6:43] What David Wishes He Knew as an Investor 

[8:30] Lessons from Private Equity 

[10:14] The Mistakes That Most PE Firms are Making

[12:24] How to Acquire Business at More Attractive Multiples

[15:36] Lessons for Lower-Middle Market Investors 

[19:27] Three Attributes of a Top Performing Investor

[23:24] Advice for Operators, C-Suite Executives, and Portfolio Companies

[26:23] What David Watches, Reads, and Listens To 

[28:20] Where to Reach David

[29:01] Parting Thoughts

Acquiring Businesses at More Attractive Multiples

One way is to know where to look, and that comes with developing one’s own proprietary deal workflow. More firms are considering entrepreneurs they’ve backed before and identifying investment ideas that no one else is pursuing yet. 

Another way is to use operating resources to create and realize upsides. It’s because there’s often more than meets the eye with businesses. Investors need to look into each element of a business to consider how it can potentially differentiate and diversify the business to generate more equity value. 

Finally, investors must change their mindset about investing. It isn’t always about financial engineering. Instead, investors should focus on building businesses with world class talent with more efficient systems. 

Building the exact asset that potential customers are looking for will allow investors to mitigate the prices they’re working with while also creating even more value to the business post-acquisition. 

3 Attributes of a Top-Performing Investor?

1.     Intellectual curiosity

As the world changes, so do investment strategies. 

Top-performing investors keep pace with the changing world by remaining curious about what’s new, how it’s going to affect their investments, and what challenges and opportunities are on the way. They need to be passionate about discovering new industries, meeting new people, and developing new skills. 

2.     Ability to spot patterns

Industries, no matter how different, will often share similar characteristics. Being able to spot these allows top performing investors to get up to speed on new industries and business models much faster than others. 

Top investors can leverage the patterns they recognize to scope out a better due diligence process and run sensitivities about how likely negative scenarios are going to happen. 

As David explains, it also helps top performers spot show-stopping deals: investments with unmanageable risks. These help investors mitigate their risks and identify better opportunities.

3.     Confidence 

Investing involves taking calculated risks and many people challenge investing decisions. Top-performing investors need to have the courage and conviction to articulate support for their investing theses. They need to ensure that their thesis makes sense. Without this ability, as David explains, deals aren’t going to get done.

Welcome to the Private Equity Podcast Playbook Series. In this series, we'll dive deep into crucial private equity subjects and provide playbooks that you can use to grow your firm or portfolio company. 

Introducing Nevin Raj

Nevin Raj is the Chief Operating Officer and co-founder of Grata, a B2B search engine for discovering small to middle-market private companies. At Grata, Nevin is responsible for leading business operations, from sales and marketing to customer success and product initiatives.

What You Will Learn:

How to Develop a Strategic Business Development Plan

The Best Way to Ask for Referrals in Private Equity

How to Play the Long Game with Private Equity Relationships 

Breakdown

[00:00] Introduction

[01:18] Inbound Prospecting and Deal Sourcing

[03:11] The Tools Needed for Proactive Business Development

[04:39] How to Implement Proactive Business Development 

[07:30] Ways PE Firms Can Drive Effective Business Development 

[10:20] Understand that the Best PE Firms Play the Long Game

[14:27] Building Relationships Before Process

[16:10] How to Start Asking for Referrals

[20:50] Ways to Build Relationships with Banking Executives

[23:35] Build Better Relationships with Lawyers and Accountants

[27:20] Engaging with Other Investors

[31:50] The "In Real Life" Strategy

[35:20] How the Top PE Firms Manage Relationships

[37:40] Parting Thoughts 

Proactive Business Development in Private Equity

Private equity firms are in a tough spot. Competition is fierce, and finding good investments at fair prices is becoming even more challenging. To stay ahead, firms are stepping up their game in deal origination and getting innovative in spotting their next big opportunity. But there is a problem: who should be responsible for ensuring these initiatives work? More and more firms are bringing in business development professionals to fill that role. These folks ensure that the proactive efforts pay off as planned.

According to Nevin, business development is proving to be a critical asset to PE funds. Once a firm start proactively building relationships, they should see a noticeable change in actionable deal flow within a few months.

How to Contact Chris

Nevin's LinkedIn

Nevin's email - [email protected]

Grata.com

Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].