Winning Moves: 105 Proven Ways to Create Value in Private Equity-Backed Companies

by Dan Cremons

The private equity market is more efficient and competitive than ever. And in this era of PE, the value buys, arbitrage opportunities, and financial engineering strategies that investors once relied on to juice returns simply aren’t as juicy and reliable as they once were.

This has put growing pressure on investors and executives to nail post-closing value creation to stay ahead. So for many firms and executives, yesterday’s playbook for success must evolve to stay competitive in today’s Value Creation Era of private equity.

Drawing on 1,000+ combined years of wisdom from 60+ successful mid-market private equity professionals and executives, Dan Cremons sets out to answer one of the most pressing questions facing private equity investors and executives

In this era of private equity, how can investors and executives get ahead by more consistently, predictably, and methodically driving value creation in their companies?

If you’re an investor or executive wrestling with the same question, this book is for you. Winning Moves—Describes the market realities in the Value Creation Era and how we got hereDeconstructs value creation into its actionable component partsEquips readers with a vast arsenal of proven "winning moves" for driving value creation throughout the deal lifecycleDemonstrates how value creation success is near-impossible without a people-focused culture and a winning teamProvides a roadmap for making value creation happen throughout a deal’s lifecycleBursting with actionable advice straight from the mid-market trenches, this book can help private equity professionals and executives accelerate equity value creation, generate better returns, and take their careers to new heights.

Genres: Finance, Business

437 pages, Kindle Edition

Published July 26, 2022

Reviews

[Brian Tan · Rating 4 out of 5]

Basically a more approachable text book. Very good learning for PE B2B businessss and how to create value. Notes below:

* Revenue is biggest value creation tool (62%)
* Retention, upsell is cheaper than acquiring new customers
* What’s ideal customer profile look like? Making sure you are targeting and segmenting. The right customers is both a better investment and cheaper on CAC.
* There are good cost and bad costs. Trim bad costs if there is no operating leverage.
* Pricing is the easiest lever (structure and price) to increase revenue, but very rarely is it priced correctly or fully optimized (by segment or usage etc). Also important for someone at the company to have ownership on executing pricing.
* Align sales comp with strategy
* M&A needs cultural integration, and works when: there is overlap in the acquired product or service, buyers in the target channel have appetite, or budget or authority to purchase, sales reps can understand it to sell, incentives our align for sales reps to sell. When merged, cost synergies from merging account systems, HR, lower financing, lower vendor costs, RE/office footprint. To do M&A, you need good infra, stable business, cash flow, able management team, clear strategy,
* Usually M&A better that deepens market penetration is better than market expansion.
* Low hanging fruit for margin expansion include processes with repetitive task, high touch, processes, time, sensitive processes, or those that need audit trails
* Just like thinking about your ideal customer profile, think about your ideal M&A target
* Talent and culture are at foundation of entire investment and value creation process

General keys:
* Start VCP early
* Combine DD with VCP
* Align culture, vision, management team with VCP
* Hypothesis driven approach
* Focus on less levers than more
* Look for 2-for-1 opps like positioning for higher close rate/price, or self serviced CS for better satisfaction and cost, or high growth focus for more revenue/exit multiple
* Move quickly post closing
* Discipline in process and execution > idea

[Martin Valdez Stuard · Rating 4 out of 5]

Compiles and repackages well known business ideas in the context of PE value creation. You won't find anything particularly new or innovative, nor much depth in the ideas presented, but it gives a good overview for someone that starts a first job in PE operations.

[Landon Klausing · Rating 4 out of 5]

Good book for anyone in PE operations