Unlocking Success: Mastering Post-Close Succession Planning to Seize Opportunities

by Jenny Gray | Nov 13, 2023 | Blog

Unlocking Success: Mastering Post-Close Succession Planning to Seize Opportunities

Authored By Jenny Gray

In the world of Private Equity, success often hinges on seizing opportunities with precision and speed. The best leaders understand the importance of strategic decision-making in the quest for high returns.

Today, we delve into an essential aspect of PE strategy – post-close succession planning and founder transition. In this blog post, we will explore the critical factors that determine whether a founder transition is needed, the value of proactive planning, and the role of Bespoke’s Strategic Resource Group (SRG) in understanding the executive talent landscape.

Is the Founder Transition Needed?

The first step in post-close succession planning is to assess whether a founder transition is necessary. Several key considerations come into play:

Private Equity Experience: Has the founder worked under private equity sponsorship previously? Not having this experience is not a deal-breaker but a founder who has worked with private equity sponsors successfully before may be better positioned to continue in the leadership role.
Feedback and Overconfidence: Is the founder open to feedback and capable of managing overconfidence? An effective leader in the private equity context requires humility and adaptability, traits that can make or break the process of achieving growth and scaling.
Operational Proficiency: Can the founder identify and rectify operational deficiencies within the company? Addressing these issues early on can lead to significant improvements in profitability, a key part of the value creation plan for most private equity sponsors.
Change Management: Is the founder open to change, and do they have experience managing through it? Leaders of PE backed companies need to demonstrate quick adaptation to market shifts, making change management skills crucial.
Emotional Intelligence (EQ) and Communication: EQ and effective communication are essential for a smooth transition. A founder’s ability to navigate relationships and foster a positive culture can impact the success of the company’s growth and value creation plans.
Operational Rigor and Data-Driven Approach: A data-driven approach and operational rigor are vital for value creation. The founder’s commitment and willingness to focus on these principles can shape the transition’s outcome.

Pre-Deal vs. Post-Deal Value Creation

Comparing a well-prepared company to a premium-built house, it becomes evident that the former offers immediate value to new ownership, much like a turnkey investment property. On the other hand, a “fixer-upper” company might come at a reduced price, but requires additional investment, vision, and time to reach its full potential. To maximize profitability within a three-to-five-year timeframe, it is best to make decisions around founder transitions and company “upgrades” as early as possible. By doing so, you enhance the company’s operational readiness early, giving more runway for value creation. If the incoming CEO has prior experience with similar plays, they can expedite the process, allowing you to realize returns sooner. Proactive planning prevents the inheritance of cultural or operational issues that can hinder profitability. This can also be a recipe for a smooth founder transition as there is more time for the founder to get comfortable handing over the keys to the castle.

SRG to Get Pulse of Landscape

With talent being the greatest value creating lever, having access to actionable data on upcoming candidates is paramount. Our Strategic Resource Group (SRG) illustrates not only the market landscape, but a perspective on potential quality of candidate and time to fill. We have also seen clients use SRG to bring on transition advisors or deal advisors who can often slide into the CEO seat post transition without a full-blown search. Unlike relying on intuition or flying by the seat of one’s pants, data-driven decision-making minimizes risks and maximizes profits. By partnering with SRG, you gain access to valuable insights about the market landscape, emerging trends, and potential opportunities. This data empowers you to make informed decisions, identify high-reward investments, and mitigate risks effectively. In the ever-evolving landscape of PE , it’s clear that proactive planning and data-driven decision-making are your allies. By partnering with SRG and embracing a well-prepared approach, you can achieve your mission of setting a new benchmark in investment profitability. Remember, meticulous planning leads to audacious success.

Connect with us to learn more about our CEO practice:

www.bespokepartners.com/transformative-ceos-and-board-members

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Author:
Jenny Gray
SVP, CEO Practice

Based in San Diego, Jenny Gray is a Senior Vice President within our CEO & Board Practice. Jenny specializes in leading CEO & Board searches for our clients across growth equity to buyout with portfolio companies in B2B SaaS. She has also specialized in Go-to-Market and Chief Customer Officer searches. She has led over 50 successful searches since she joined Bespoke in 2019 and has placed executives across multiple portfolio companies including Thoma Bravo, Insight Partners, Clearlake Capital, K1, PSG and others.

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The Leadership Factor: Orlando Bravo Details the Formula for Portfolio Company Success

by Eric Walczykowski | Sep 19, 2023 | Blog

The Leadership Factor: Orlando Bravo Details the Formula for Portfolio Company Success

Orlando Bravo hit the nail on the head in a recent CNBC interview when he emphasized that the right leadership is key in making companies more profitable.

Orlando is founder and managing partner of Thoma Bravo, led its early entry into software deals and built the firm into one of the top private equity firms in the world.

We at Bespoke have been very fortunate to have worked with Thoma Bravo on more than 200 senior executive searches for the firm’s software and SaaS portfolio companies.

200+ executed senior executive searches for the firm’s software and SaaS portfolio companies.

From our perspective, Orlando and Thoma Bravo have cracked the code on the role that leadership plays in value creation.

“It is so important that you focus on leadership,” Orlando told CNBC. “If you have the right CEO partner and you’re of like mind philosophically on how the companies run and operate, that is a must.

“It starts there. That CEO needs to have the right direct reports in the key functional areas of the company and they need to be on the same page.”

orlando bravo cropped There are other significant factors to achieving investment success, but, as Orlando said, execution of priorities comes down to leadership and a close working relationship with the private equity sponsor.

Further, the focus should be on profitable growth, Orlando explained.

“We believe – and I feel we have proven this – that the more profitable you are, the faster you will grow. We don’t subscribe to the view that happened in the bubble years, that to really grow, you need to dip earnings and be unprofitable.”

Orlando’s comments underscore the trend we have seen throughout our own work with private equity clients, that capital-efficient growth is the key to value creation and achieving the investment thesis.

bespoke report In some sectors, the “grow at all costs” strategy has beenthe fashion, with the idea of grabbing market share and letting profitability come later. But our clients have consistently focused on profitable growth and recruiting leaders who know how to orchestrate it.

We detailed the focus on profitable growth in private equity portfolio companies in the latest edition of our Private Equity Talent Benchmark Report, available here.

Following this philosophy, we have recruited more than 1,000 executives in private equity-backed software and SaaS firms. Our placed execs have gone on to execute more than $130B in exits and platform value growth.

You can see Orlando’s full interview on CNBC here.

Author:
Eric Walczykowski
Chief Executive Officer

Eric is passionate about building high-performing teams that value doing their best, working together, overcoming adversity and learning.

As a proven growth executive, Eric has served as CEO, President, Board Member, Investor and Advisor for technology companies that achieved over $4.5B in successful exits.

Eric brings to Bespoke Partners significant professional services experience from Deloitte and Andersen, as well as the high-growth client executive perspective for private equity-backed technology companies.

Eric earned an MBA from the Kellogg School of Management at Northwestern University and a BS in Business from Fresno State University.

Outside of work, Eric enjoys spending time with family, coaching baseball, travel, attending live events and sipping good wine.

Finding Balance: Navigating the World of Virtual Work

by Julie Catalano | Sep 13, 2023 | Blog, EVP

Finding Balance: Navigating the World of Virtual Work

Authored By Julie Catalano

As we sail through the ever-evolving landscape of the modern business world, the concept of the virtual workforce has firmly taken root.

In recent times, big tech giants have been advocating for a return to the office. Other companies remain committed to a virtual workforce.

In this month’s blog, we delve into the intriguing dichotomy of the virtual workforce, the challenges it presents, and the undeniable value of fostering intentional in-person connections.

The Virtual Workforce: Challenges and Benefits

Undoubtedly, the digital age has blessed us with remarkable technological advancements, enabling us to stay connected no matter where we are.

Virtual meetings, remote collaboration tools, and flexible schedules have revolutionized how we work. However, as we immerse ourselves in this digital realm, we must acknowledge the unique set of challenges that come hand in hand.

First and foremost, the absence of face-to-face interactions can lead to a sense of detachment.

Video meetings, though efficient, often lack the spontaneity and intimacy of in-person conversations. The informal water cooler chats, the unspoken cues exchanged during a meeting, and the camaraderie built over coffee breaks – these elements contribute to a holistic understanding of our colleagues and their perspectives.

On the flip side, the virtual setup offers unparalleled flexibility. It erases geographical boundaries, allowing us to tap into a diverse talent pool and embrace work-life integration.

The ability to work from the comfort of our homes can boost morale and productivity, fostering a healthy work environment.

It also adds a level of intimacy as we share pieces of our personal lives with the camera, like my German Shepherd, Leo, who enjoys attending many meetings alongside me, as he naps in camera view from my home office.

Reimagining Intimacy: The Value of In-Person Time

Amidst our commitment to the virtual workforce, we acknowledge the irreplaceable value of face-to-face interactions. The human connection, those subtle nuances that can’t be captured through a screen, is where the magic truly happens.

Recently, Bespoke Partners orchestrated a two-day all-team summit in picturesque Carlsbad, CA. Far beyond being a mere gathering to discuss business strategies, this event stood as a purposeful endeavor aimed at forging profound connections.

Our meticulously curated agenda balanced a critical business agenda with generous moments dedicated to breaking bread, fostering social bonds, and nurturing camaraderie. We even added a highly competitive cornhole tournament into the mix!

Yet, amid all these memorable moments, the highlight for me was a final intimate dinner with my People & Culture team, hailing from San Diego, Boulder, and Austin. Despite the geographic expanse that separates us, our connection remained resolute and engaged.

Carving out this time allowed us to revel in our collective achievements and partnership, all while savoring Aperol Spritz and indulging in the exquisite delight of honey-drizzled burrata. It was the perfect closure before hopping on the red-eye back to the East Coast.

The summit served as a testament to our belief that true collaboration transcends pixels and wires. We witnessed the power of being physically present, sharing stories, laughter, and insights. This in-person time breathed life into relationships, creating a solid foundation to navigate the challenges that lie ahead.

Finding Balance in a Digital Age

As we tread the fine line between the virtual and the physical, we acknowledge that there is no one-size-fits-all solution. While embracing the virtual workforce, we understand the profound impact that intentional in-person time can have on our culture and relationships.

In the dynamic realm of private equity, where relationships are pivotal, Bespoke Partners remains committed to fostering connections that go beyond the virtual realm. We believe that the future of work demands a balance – a harmonious symphony of digital connectivity and the warmth of human touch.

Let’s continue to harness the power of technology while cherishing the irreplaceable essence of personal connections.

Thoughts on this topic or others?

Message us at info@bespokepartners.com to be considered in future posts.

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Author:
Julie Catalano
Chief People Officer

Julie brings more than 20 years of senior leadership in human resources, organizational culture, and business strategy. Prior to Bespoke, she served as Vice President, Global Human Resources at Vertex Inc. and has held multiple key leadership roles across the HR disciplines at Vanguard.

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Recruiting Top Talent to Counter Market Headwinds: New Report

by Eric Walczykowski | Aug 9, 2023 | Blog

Recruiting Top Talent to Counter Market Headwinds: New Report

As I’ve checked in with clients and colleagues across the industry over the past few months, an overriding theme has come through: Running to stand still.

We detail the numbers behind this sentiment in our just released 3Q edition of the Private Equity Talent Benchmark Report. Get your copy here.

The recent surge in interest rates has had a significant impact on corporate expense budgets, prompting companies to tighten their financial belts. As a result, corporations have been forced to prioritize their technology investments, distinguishing between those considered “nice to have” and those deemed “need to have” for their operations.

This approach has resulted in softened demand for software solutions, leading management teams to reevaluate and downwardly reforecast their revenue expectations. Consequently, private equity firms find themselves facing longer hold periods for their investments, as it will take more time to achieve the originally projected investment thesis in this challenging economic climate.

Tackling Turbulence

We’ve witnessed some interesting responses to the sector slowdown.

First, many firms are using this period to reassess talent and consider whether they have the right teams in place.

Second, the pivot to capital-efficient growth has taken hold in a major way. data-driven

In years past, a “grow at all costs” mentality has been viable, with the notion that grabbing market share regardless of customer acquisition costs can set you up for greater profitability down the road.

Amidst the current challenging market conditions, our clients are seeking executives who possess the expertise to strategically position their companies, even in a down market.

These executives must excel in driving revenue growth, making it an indispensable priority, while also demonstrating an aptitude for optimizing internal spending to maximize ROI.

Moreover, they are expected to navigate their organizations toward capital-efficient growth, embracing lean operations and efficient customer acquisition strategies.

Key Findings: New Talent Report Edition

The mid-hold evaluation and upleveling of leadership teams is why the market remains very tight for key positions even though deal-flow has slowed significantly industry wide.

Proficiency in capital-efficient grow is the skillset in greatest demand. This means leaders who know how to grow revenue and profit at the same time are prized.

Turnover and elevated compensation packages in CEO and GTM roles are a direct result of the mid-hold upleveling. But the market for seasoned leaders with private equity experience remains relatively tight across the board.

We have expanded our analysis of Step-up candidates when compared to sitting candidates. If vetted properly, Step-up candidates are indeed viable options for widening the talent pool to counteract this market tightness.

A Step-up can be just as effective as a seasoned executive at achieving the desired exit for a company but can cost considerably less in terms of compensation over the hold period.

We also have expanded our analysis of leadership team composition. The C-suite in the average portfolio company reaches 69% occupancy across the roles we track when companies reach the $100 million revenue range.

Get your complimentary copy of the Private Equity Talent Benchmark Report.

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Author:
Eric Walczykowski
Chief Executive Officer

Eric is passionate about building high-performing teams that value doing their best, working together, overcoming adversity and learning.

As a proven growth executive, Eric has served as CEO, President, Board Member, Investor and Advisor for technology companies that achieved over $4.5B in successful exits.

Eric brings to Bespoke Partners significant professional services experience from Deloitte and Andersen, as well as the high-growth client executive perspective for private equity-backed technology companies.

Eric earned an MBA from the Kellogg School of Management at Northwestern University and a BS in Business from Fresno State University.

Outside of work, Eric enjoys spending time with family, coaching baseball, travel, attending live events and sipping good wine.

Why Successful C-Suite Executives Work With Bespoke Partners on Their Next Moves

by Matt Sommi | Aug 2, 2023 | Blog

Why Successful C-Suite Executives Work With Bespoke Partners on Their Next Moves

Authored By Matt Sommi

We’ve all seen the analysis on how tight the market is for top portfolio executive talent in the private equity sector.

It’s a “seller’s market” through and through, with seasoned executives in the driver’s seat. Many of them are fielding multiple recruiter inquires at any given moment.

Our Private Equity Talent Benchmark Report has been documenting the trend
(get your copy here).

So given all the interest in these executives, why do so many of them work with Bespoke Partners to evaluate their next C-suite roles?

They have the option to work with any recruiting firm. But with our specialization in private equity and our singular focus on software and SaaS, we are the choice of both private equity firms and the candidates they are looking for.

In this posting, I’ll detail a few of the reasons that top executives want to partner with us.

1. Functional Specialization

Bespoke Partners is a dedicated team of professionals with extensive knowledge and experience in the software industry
that C-suite candidates can trust.

Our partners’ functional alignments allow them to intimately understand the market for positions they are recruiting for and build relationships within that industry vertical. We go deep on all leadership functions, including CEO, Finance, Go-to-Market, Product & Technology, and People & Talent.

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2. Our Client Partnerships

Bespoke has been committed to the software industry from the start. Our hyper-focus on software and SaaS businesses is not the only thing that sets us apart in the competitive market when reaching out to candidates and placing them at top-tier companies.

It is also our track record of partnering with leading private equity firms. We have worked with the most active software investors in the world, placing more than 1,000 top executives in their portfolio companies. Thoma Bravo, Insight Partners, Francisco Partners, Vista Equity, TA Associates and many other blue chip private equity firms have trusted Bespoke to execute on their talent strategies.

3. Our One-of-a-Kind Software & SaaS Network

Our reputation and focus has allowed us to build a network of the most qualified C-suite candidates with exceptional track records in software and SaaS.

Our network of software and SaaS executives who can be considered for a senior leadership role exceeds 100,000 members. Our expanded software executive pool includes another 700,000 executives in adjacent markets and in lower-level roles, who may make great Step-Up candidates or who may have skills that can transfer into private equity portfolio companies from other sectors.

group of 3 people working

In short, we give clients unmatched visibility into the talent market for the roles they need to fill that are central to growth and achieving the investment thesis. For candidates, joining our network means riding the inside track to be considered for these mission-critical roles.

In fact, now software and SaaS companies and their private equity sponsors can access our unbeatable network directly to connect with
C-suite executives. Our Strategic Resourcing Group (SRG) is an introduction service that delivers continuous introductions to hard-to-reach candidates for software and SaaS companies. It allows firms to gain curated access to our network, get real-time visibility into the talent market, and cut weeks or months from typical search times.

4. Our Process

When we conduct our uniquely focused and data-driven search process, we make sure to meet the needs of both the candidates and our clients.

One way we do this is by restricting our recruiters to a maximum of six searches at any given time. This approach lets our clients benefit from a concentrated and dedicated engagement, while candidates enjoy an extremely high touch, personalized experience with frequent communication and updates. Our goal is to ensure candidates are aligned and enthusiastic about the opportunities we bring to them.

The result is a search that closes more quickly but also has a much higher chance of being the right fit. Both these benefits are crucial for a software or SaaS company that is executing on value creation plans and cannot waste time.

We especially prioritize spending ample time early in the search process with the client, working through the scorecard and job specification. Our advanced scorecarding provides a comprehensive view of the candidate fit with the role, while our FIT Profile™ uses management science, state-of-the-art tools and behavioral assessments to generate a holistic view of the candidate and his or her fit with the company and executive team.

The results speak for themselves — we are proud to operate with an industry-leading 95% success rate on our new executive placements. We’re so confident that our process will result in a great fit for both the candidate and the hiring company, we back it with an industry best Two-Year Guarantee on executive placements.

Are you a private equity firm or talent professional looking for the best leadership for a portfolio company? Or are you an experienced C-suite operator looking to make your next move?

Get in touch and let’s explore the possibilities: www.bespokepartners.com/contact/

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Author:
Matt Sommi
Vice President, Private Equity

Based in Philadelphia, Matt helps lead Bespoke’s client engagement efforts across the firm’s suite of services. Prior to joining Bespoke, Matt spent 8 years in research and business development at GLG, supporting private equity due diligence efforts and building relationships with GLG’s middle market private equity firms.

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Nurturing Talent Within: Our Commitment to Developing Exceptional Leaders

by Julie Catalano | Jul 24, 2023 | Blog, EVP

Nurturing Talent Within: Our Commitment to Developing Exceptional Leaders

Authored By Julie Catalano

July brings exciting news as we celebrate the promotion of three of our longtime team members to Partner, Katherine Baker, Alex Bossetta and Ned Lanphier, a testament to our steadfast belief in nurturing and empowering our own team.

At Bespoke, we take immense pride in our unwavering commitment to developing our people from within. In this month’s blog, I will share some of our secret sauce around how Bespoke Partners champions internal growth, highlighting our unique training programs, talent review processes, and the art and science behind our executive search methodology.

Investing in Our People

At Bespoke Partners, we recognize that our success is deeply intertwined with the growth and development of our team members. We have created a comprehensive internal learning journey through our virtual campus of Bespoke University, providing our employees with the tools and knowledge necessary to excel in the industry. This virtual learning platform combines expert-led courses, interactive workshops, and ongoing mentoring opportunities to foster a continuous learning culture within our organization.

Unleashing Potential through the 9 Box Talent Review Process

To identify and nurture top-tier talent, we have implemented the 9-box talent review process. This rigorous evaluation method allows us to assess individual performance and potential across multiple dimensions, enabling us to identify high-potential individuals who demonstrate the capacity to excel in leadership roles. By leveraging this process, we ensure that our development efforts are focused on cultivating the most promising talent within our ranks.

Mastering the Art and Science of Executive Search

bespoke team meeting Executive search is an art that requires intuition, experience, and an in-depth understanding of industry dynamics. At Bespoke Partners, we have perfected this art while infusing it with the precision and objectivity of a scientific approach. Our team undergoes rigorous training to master the “Bespoke Way” of conducting searches, combining strategic thinking, cutting-edge research, and meticulous assessment techniques to identify exceptional leaders who are a perfect fit for our clients’ needs.

Alex’s viewpoint really underscores this point about our client focus. “Since I first interviewed with Bespoke, it’s been my goal to launch a practice focused on placing human capital leaders to drive growth for our clients,” she says.

“It’s been rewarding to help define the talent thesis for portfolio companies through strategic human resources placements. I am honored by the trust our clients place in us as we build out exceptional teams in their companies.”

Delivering Value to Our Clients

Our commitment to nurturing talent within our organization translates into tangible benefits for our clients. By investing in the growth and development of our team, we ensure that they possess a deep understanding of the industries we serve, allowing us to deliver executive search services that are tailored to our clients’ unique requirements. When you choose Bespoke Partners, you are not only gaining access to our extensive network, but also partnering with a team of professionals who embody the values of integrity, innovation, and excellence.

I think Ned said it best in the recent announcement of his promotion. “I’m honored to be part of the amazing team of executive search professionals at Bespoke Partners,” he said.

“It’s exciting to bring game-changing talent to our clients and help them to transform their portfolio companies and achieve their investment thesis. Technology leaders play such a pivotal role in software and SaaS companies and I’m extremely proud of our exceptional track record.”

bespoke culture

Joining the Bespoke Family

For ambitious professionals seeking a workplace where their growth is prioritized, Bespoke Partners is the ideal destination. We invite individuals who share our passion for developing talent and delivering exceptional results to consider joining our team.

At Bespoke, you will find a supportive environment, continuous learning opportunities, and the chance to work alongside industry leaders who are dedicated to unlocking your full potential.

At Bespoke Partners, our commitment to developing our people from within is the cornerstone of our success. We have built a culture that fosters excellence, innovation, and unparalleled client service. We invite clients seeking exceptional executive search services to partner with us and experience the Bespoke difference.

I love how Katherine expresses it. “Bespoke is built on a principle I am passionate about, which is that client success is our success,” she says.

“I’m thrilled to be part of a team that wakes up every day with that goal in mind. I want our clients to know that working with Bespoke was the right choice every time we bring them a top-performing CEO.”

Likewise, we extend an invitation to talented professionals looking for an organization committed to their growth and development to join the Bespoke family. Together, we can drive value creation and unlock limitless potential within the private equity landscape.

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Author:
Julie Catalano
Chief People Officer

Julie brings more than 20 years of senior leadership in human resources, organizational culture, and business strategy. Prior to Bespoke, she served as Vice President, Global Human Resources at Vertex Inc. and has held multiple key leadership roles across the HR disciplines at Vanguard.

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