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Private equity keeps hiring “value creation” people, then sends them into portfolio companies with zero mandate, zero budget, and the authority level of a polite email. And then everyone acts confused when the plan doesn’t happen. Obvious value creation: We underwrote 300 bps of margin expansion from “procurement synergies.
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That’s the whole game. You ask for growth. They pick the metric that moves fastest and connects to cash slowest. Suddenly the weekly update is a victory lap because CTR is up. Or CPM is down. Or “engagement” is strong. Or leads are “cheaper”. None of which tells you
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They fail because integration was treated as a future problem. The pitch always sounds the same. Buy fragmented assets. Centralise back office. Unlock synergies. Scale. What gets skipped is the hard part. How these businesses actually work once they’re stitched together. Different pricing logic. Different sales behaviours. Different tech
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Translation for anyone still clinging to 2016: the deal doesn’t work unless you actually run the business. Awful, I know. A decade ago, a “typical” buyout could hit a 2.5x over five years with ~5% annual EBITDA growth because leverage was fat and multiple expansion did the heavy
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It’s what people say when they haven’t done the hard part, which is deciding who actually owns the outcome, what “good” looks like, and what happens when it doesn’t show up. This is the incentives problem in four squares. Top right is grown up capitalism. Clear targets.
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I asked a model to launch a $2B services roll up. It named the fund, designed the logo, scraped every founder over 55 within a 50 mile radius of a metro with above average household income, and ranked them by “succession anxiety score.” It built the investment committee memo before
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You see this constantly in home services and other PE-backed, multi-location businesses. New locations are added faster than systems mature. Marketing budgets increase, but lead quality becomes harder to explain. Revenue targets go up, while visibility into what’s actually driving demand goes down. On paper, the business is scaling.
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Somehow we all accept that in every other part of the business. Capex gets a model. Headcount gets a plan. Even the CFO’s “strategic initiatives” get a spreadsheet and a quiet prayer. Marketing gets vibes. That’s why I call the right theory "Investment Marketing". Marketing is
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It’s lost on “good” deals that nobody knows how to run. The model works. The thesis makes sense. The entry multiple is defensible. Then the deal closes. The deal team rotates to the next opportunity. Attention shifts. Execution becomes someone else’s problem. That’s when ambiguity creeps in.
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CFO wants ROI by channel. Marketing says attribution is complicated. Both are correct. One is trying to run a business. The other is trying to win an argument. Attribution is the adult version of astrology. It’s brilliant at explaining the past and useless at predicting the future. And somehow
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It’s evidence you know how to raise a fund. Those two skills get conflated constantly. Conveniently. Raising capital proves you can tell a compelling story, manage a process, and convince LPs. It does not prove you can fix pricing. It does not prove you can scale demand. It does
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You’ve met them. Their superpower is turning reality into a “narrative” and then asking Comms to make it feel “more confident”. This chart is basically the leadership landscape. Top left: doing the actual work. Calling the ugly stuff early. Making decisions that annoy people in the moment and save