Over the last 25 years it has become harder to make money in the mid-market. Investors who previously paid low entry multiples, could deploy plenty of debt, grew earnings due to mostly benign economic conditions, and backed experienced teams, now pay higher multiples, use less debt, face a more volatile environment, and largely back entrepreneurs. That has made the ability to deal with teams and organisations both more vital and more complicated.
This handbook is designed to act as a reference guide and aide memoire for busy investors to make it easier to get people issues right. It is not intended to provide a full justification for each of the various steps suggested. The aim here is not to make you a team and organisation specialist but rather, as a board member, to be able to ask the right questions and offer an informed opinion where needed.
The basis for this advice is my 30 years in private equity as an LP, GP, adviser to management, researcher and almost 20 years as an adviser to UK mid-market firms. During that time, I have been involved in about 800 projects of which 745 have been as Catalysis. This provides a good database of experience from which to draw lessons about what works and what doesn’t.
The handbook covers:
Assessing teams pre-deal
Setting up governance and strategy post-deal
Making senior appointments
Improving boards and teams
Improving organisations
Collateral and processes inside private equity house
Further reading suggestions
