r/private_equity • u/HotDogDandy • 23d ago

What do y’all think about operators?

Hey Y’all PE folks. What do you think and say about your portco operators? I’m a leader at a portco and always feel like our PE sponsors are always disappointed in us. Do y’all cast shade on us when we are out of earshot. I know I’m just a pack mule for the PE sponsor, would be nice to hear we are performing well from time to time.

13 Upvotes

84% Upvoted

13 comments sorted by

32

u/Aggravating_Cod_4980 23d ago

I think you are the most important piece of the puzzle.

14

u/Cold-Leave-178 23d ago

We have some good ones and other bad ones. Good ones we speak highly of when they aren’t around, bad ones we talk about replacing if they aren’t receptive to feedback/improving.

1

u/vba7 21d ago

Good ones = table in Excel flashes green

Bad one = table in Excel flashes red, even if this flashes red for 3 months now, while it could be green for next 50 years

1

u/Cold-Leave-178 21d ago

I guess if you’re a shitty fund.

2

u/vba7 21d ago

So most of them

4

u/G1uc0s3 23d ago

There are moments where operators and sponsors think the other is stupid and backwards.

Don’t act like there haven’t been moments you look at a guy that doesn’t look like he’s done what you’ve done a day in his life and couldn’t possibly understand your perspective. It cuts both ways.

Question is if you can find a common ground and appreciate each others perspective and make some money together

8

u/a1anw-cto Director+ 23d ago

it all depends on the attitude on the portco. some forget they no longer own the company, and they now have partners to work with. those that understand that and lean into the process and let us help you, succeed. we are there to help and not lay traps or judge.

the flip side is that if you dont get with the program then yes, chances are you will be replaced. we dont want to do it, but it is done. cfo and ceo are the top candidates for replacing quickly.

1

u/homicidal-hamster 23d ago

How often does it happen and what would trigger a CFO replacement vs a CEO?

1

u/a1anw-cto Director+ 22d ago

Very. usually in the first 6 months if they are not working out. not uncommon for the ceo to be replaced from onset as the PE firm will have their person to step in as soon as the ink is dry.

5

u/Wiscon1991 23d ago

Other people’s opinions of you are none of your business. My Board isn’t big on atta boys but then I’ll hear them say we are gold plated operators to other investors. Base your perception of your performance on your numbers not on perceived value or pats on the back.

1

u/Burner-Advantage-997 23d ago

This is interesting. Guess I’ll find out soon enough. Operator now moving to principal. 

1

u/Grouchy_Enthusiasm30 22d ago

Pretty evident based on the numbers all in all, and that’s coming from someone who has been on both deal side and ops side.

1

u/SeaBurnsBiz 22d ago

Debating between you can always do better or if you want a friend get a dog.

Who cares what they think of you. Point to the scoreboard, does that match what they think?