During my career one of the more enjoyable challenges I’ve taken on has been working with private equity owned businesses to help them reposition their offering ahead of selling the entire operation.
Sometimes this has meant advising a legacy leadership team, while at others it has meant coming on board to help the new owners effectively ‘flip’ the business, taking it from a struggling enterprise to a success story that can fetch much more than they originally purchased it for.
Along the way I’ve learned a number of things – some of which I’ve decided to share here with this post on how to reposition private equity backed businesses for sale.
Five ways to successfully reposition private equity owned companies for sale
1. Build a comprehensive digital presence
When you’re looking to sell a private equity owned business, your company’s digital presence is paramount.
The first place to start is your company website. This essentially becomes a shopfront for everything that makes your operation attractive to potential buyers, so it pays to ask yourself whether it achieves everything you need it to – and if not, to commission a comprehensive redesign. In particular, your website should show all of your sectors, revenue streams and the full potential of your business, while telling a compelling company story that makes potential buyers want to take it on.
Outside of your website, your social channels and other digital marketing avenues should also be operating consistently to convey to buyers that your business is an active player in your market and has a strong and forward-thinking marketing operation behind it.
2. Diversify your sectors
One of the big strategic secrets of building value for a private equity sale is to invest in new markets in order to give the company more strings to its bow – and, crucially, more revenue streams. Often this is as much about perception as reality.
Often, I’ll meet with the leadership team of a business that’s encountering significant challenges, only to discover they have some incredible opportunities in associated sectors that they’ve not branched out into, either from a lack of connections, a lack of knowhow, or just from not understanding how big the opportunity actually is.
This is really business development, so a good place to start is with the steps in my guide to putting together a business development plan. This includes gaining more market intelligence to fully understand the opportunities available in related product streams and market sectors.
3. Simplify your business practices, adopt appropriate tools and increase process efficiency
My third tip for how to successfully reposition private equity backed companies for sale is to optimise the business and the way it operates; this often requires some restructuring. Making sure you have the right people – particularly in leadership roles – and that your team structures, working processes and technological platforms are all set up to deliver success, is one of the most important parts of making a business feel like a well-oiled machine.
Suffice it to say, a business that’s modernised and adjusted to run far more efficiently is not only set up to deliver against its business targets and any new sector expansion you’ve targeted, it’s also far more attractive to the potential buyers who will want to come in and hit the ground running with the existing business reality you’ve worked hard to put in place.
4. Align your leadership team, staff and external stakeholders
In my experience of repositioning private equity owned businesses for sale, you can’t do the three steps above without having the right people all singing from the same hymn sheet. This can take some change management, often with your leadership team needing to carefully introduce and explain the changes the business is going through and aligning everyone behind the ‘why’.
If the business has been struggling, the internal situation often is that the company is being proactive in order to try to turn things around. In these instances, explaining the development plan in a measured and considered fashion can have a decidedly positive impact on morale and engagement. Nonetheless, the changes needed are likely to cause some major upheaval, especially if they mean abandoning old business models or letting people go. Therefore, you should expect some difficult conversations too, and some resistance to change before the team can unite behind the new vision and future successes can be achieved.
5. Grow your lead pipeline and implement CRM
My last way to successfully reposition private equity backed companies for sale is one area in which I specialise and have made a very successful part of my interim and consultancy career. Growing your marketing pipeline is essential to expanding your business operations, and implementing Customer Relationship Management (CRM) tools can make an enormous difference in deploying successful customer-focused campaigns and measuring their successes. Growing these various pipeline streams, across multiple sectors and channels, gives clear evidence to potential buyers that you have a robust and sustainable business.
Do you need to improve your business’s operational efficiency and marketing operations?
With decades of experience as a senior marketer, strategy and business development consultant, I have the skill set and knowhow that can help businesses transform the way they work – whether you’re looking to reposition for a private equity backed sale, or simply make your operation a greater success.