Supporting a Private Equity firm to maximise their portfolio firms’ value creation potential

In September 2021, LCap was engaged by a leading mid-market Private Equity firm to help assess leadership teams currently in their portfolio, as well as those they were looking at pre-deal. The Private Equity firm in question had made a series of changes to their portfolio but had never done so with the innovative and rigorous approach that Leadership Dynamics analysis provides.

The key questions the client was looking to answer included:

• What do the leadership teams operating within their portfolio companies and pre-deal pipeline look like today?

• What changes, if any, could be made to optimise the teams for success within their specific value creation contexts?

• What factors should be considered to ensure leadership teams in their portfolio are investable for future prospective buyers and are more likely to generate upper quartile exit events?

To develop insight and understanding around these questions, LCap undertook a 2-week arm’s length Leadership Dynamics project to provide recommendations against the key questions. The work undertaken included:

• An evaluation of the structure, experience, and projected behaviours using Leadership Dynamics’ Leadership Success Propensity Model for each portfolio business, as well as those within their pre-deal pipeline.

• A macro-analysis of the Private Equity firm’s portfolio and pre-deal pipeline using our rigorous comparison tool.

This Leadership Dynamics Portfolio Review provided the Private Equity firm with a clear and rigorous understanding of the leadership teams within their portfolio and pre-deal pipeline. Overall, the insights provided the investor with a preliminary roadmap to maximising value through leadership for their portfolio companies and offered a unique examination of companies in their pre-deal pipeline.