Private Equity investment within the consumer industry is still buoyant with the sector often being seen as a ‘safe bet’ for investors. The sector consistently pulls in more PE funding than other industries… after all we will always need to eat and drink. There are many success stories of businesses that have flourished with PE investment. They were given the financial support to innovate, expand and to recruit the right leadership to deliver future growth, at pace, in a competitive and mature marketplace.
There is always an element of risk; time scales of a likely sale, change in leadership, available real time investment and this risk will vary with the size of the business. When considering working for a PE owned business, size does matter! A large business operates with different processes, resources and decision making pace than a smaller one. If you are looking for a little more freedom, fluidity and real sense of ownership, then an SME maybe a better option.
Irrespective of size, I am constantly surprised by the wide variety of feedback and experiences that are shared by candidates. This ranges from ‘never again’ to ‘find me another’. Unfortunately, a number of the ‘not so good’ experiences were down to unpredictable circumstances or changes that could not have been foreseen. However, a number are simply down to lack of due diligence and ‘soul searching’ on the part of the individual!
Typically as a head hunter many of my favourite questions start with ‘but why…?’
- Why didn’t you like it? Why did you love it?
- Why wasn’t it what you expected?
- Why didn’t you spend more time with the CEO/PE Partner understanding their style, expectations?
- Why didn’t you review the accounts/debt leverage/cash available for investment?
What really surprises me is the lack of consideration individuals often give into their own personal motivations. The ‘pot of gold’ at the end of the rainbow is not enough. If you are approached about the opportunity to join a PE backed business, don’t be afraid to ask yourself some key questions:
- Do I crave more autonomy? Will I enjoy the challenge of working within an organisation with a less defined structure and I may have to be more hands on?
- Do I want more say in the decision making process? This means enjoying the rewards but equally being accountable if things are not going so well.
- Am I happy to work in an evolving culture? Am I comfortable being challenged regularly on my decisions?
- Do I buy into the vision of the shareholders? Have I really understood their experiences and reputations within the sector? Do I like them?
- Can I add value to this business? Am I ready to think and behave like an entrepreneur?
Remember when investors acquire businesses they spend a huge amount time doing their due diligence. You should approach your career in the same way. The more you know the more engaged you will be with the business when you join and be able to learn from both the highs and the lows of what can often be an exciting journey!
Alka Gandhi is a Principal Consultant in the Consumer Practice of Berwick Partners. She has a nationwide remit working closely with private equity, family owned and blue chip organisations recruiting leadership talent.