Avoiding Bad C-Suite Hires in Private Equity Portfolio Companies

Making a bad C-suite hire is the biggest risk facing any portfolio company. Besides wasting compensation, a mis-hire in the C-suite can result in strategy mistakes, broken processes and poor employee morale. But even worse for a private equity portfolio company, a bad C-suite hire consumes precious execution runway, the time that the company should be implementing the value creation plan. That means even one bad C-suite hire can increase the hold period or even derail the investment thesis entirely. Eric Walczykowski and Tess Fischer, CEO and partner at Bespoke Partners, were joined by Brian Kasser, talent partner at Welsh, Carson, Anderson & Stowe, and Mike Song, managing director, portfolio operations at Providence Equity Partners, to explore the latest best practices for mitigating the risk of making a C-suite mis-hire:

• The rising importance of talent and human capital as the chief lever of value creation and the resulting market dynamics.
• Private equity industry talent trends and, in particular, how the timing of leadership changes affects an investment thesis.
• Securing leadership placement guarantees to reduce the risk of talent disruption.
• Using behavioral assessment techniques for yielding deeper insight into how a leader will perform in a role.