As the speed of change continues to increase, a culture of innovation is a differentiator private equity firms can use to accelerate growth through their portfolios. Embracing a culture of innovation can improve acquisition strategies, increase the certainty of close, expose previously hidden opportunities for performance improvement and drive value creation.
From a competitive perspective, time is of the essence. A 3-4 year plan to complete a project doesn’t make sense in today’s digital world. Instead, a 12-14 month timetable is more realistic. And there are initiatives that demand an even shorter completion time. A culture of innovation breeds efficiencies throughout all functions of a portfolio and gives the private equity parent a clear and transparent platform to measure progress and make outstanding decisions.
At this year's Sohn Investment Conference, Dan Sundheim, the founder and CIO of D1 Capital Partners, spoke with John Collison, the co-founder of Stripe. Q1 2021 hedge fund letters, conferences and more D1 manages $20 billion. Of this, $10 billion is invested in fast-growing private businesses such as Stripe. Stripe is currently valued at around Read More
A culture of innovation, coupled with the ability to execute, will help private equity firms dominate the competition through each phase of the investment life cycle. Innovation done well enables organizations to take great ideas and turn them into sizable returns.
When compared to their peers, private equity firms and their portfolios typically demonstrate over-sized returns from a culture of innovation. They benefit from more consistent track records of meeting key performance indicators and providing healthy returns to their investors.
Innovative PE firms usually breed innovative portfolio companies. Watch as CohnReznick Advisory National Director Keith Denham discusses how innovation can be leveraged across all operational areas and what is possible for companies that commit to a culture of innovation.
This article represents the views of the author only and does not necessarily represent the views of PitchBook.
By Keith Denham, CohnReznick Advisory National Director – PitchBook