How Connected are PE Firms?

PE firms are increasingly aware of the critical role that leadership teams play in the performance of their portfolio companies. Moreover, the connections that come with these roles mean these individuals can be of wider value to the PE firm itself, aiding recruitment, due diligence efforts and facilitating business development. In a highly competitive market, firms that are able to manage, acquire and make the most of this talent stand to benefit considerably.

BoardEx’s Insights on Portfolio Company Talent 2022 focuses primarily on the US and, specifically, the thousands of current CEOs and CFOs of portfolio companies that are fully or partially owned by US PE firms in the PEI 300.

We begin with a discussion of the central role that leadership teams play in their portfolio companies and the impact they have on company performance. Focusing on portfolio company CEOs and CFOs, we detail their large number of connections to people in leadership positions in general, highlighting how these individuals bring value to PE firms, not just in terms of their talent but from their connections too.

Drawing on BoardEx’s unique and extensive data, we take a deep dive into the age, gender, educational background and experience of these CEOs and CFOs. We also rank the companies and organizations that come out on top according to the proportion of alumni who are currently CEOs and CFOs of portfolio companies. We conclude by looking at these two roles in UK-based PEI 300 firms, identifying some of the main similarities and contrasts between them and their US counterparts.

BoardEx’s Insights on Portfolio Company Talent 2022 offers a unique understanding of the characteristics of the CEOs and CFOs who lead and steer these companies, making it an essential read for firms looking to make the most of their talent management and acquisition strategies.

Explore some of the findings uncovered by this study:

• More than two-thirds of current us portfolio company CEOs and CFOs were appointed externally
• Upon assuming the role, the average CEO or CFO of a company owned by a PR firm had more than 20 years of professional experience
• Just 7.5% of US portfolio company CEOs are women, slightly higher than among businesses in the S&P 500
• Harvard University and the University of Pennsylvania have the highest proportion of alumni among current CEOs and CFOs
• McKinsey and leading tech firms account for the highest proportion of CEOs in their alumni

Download the full Insights in Portfolio Company Talent 2022 report here.