Delving into operating styles to find your best match, and the importance of aligning yourself with the right fund.

Part of diligencing a prospective role means also understanding the firm behind the portfolio company. Knowing exactly what drives the sponsor you’ll be working for will make you stand out as a candidate. When sponsors look at candidates, they evaluate how that executive will fit into their operating style. If you understand how sponsors take into account their operating style when choosing between candidates, it will give you a solid advantage. It will also help you evaluate when an opportunity is right for you. 

There is no one-size-fits-all to determine the “right kind” of sponsor. In a recent Falcon survey asking members to list what they felt their funds did well, several respondents said that strong board governance and guidance, plentiful help and operational resources, and frequent meetings to establish alignment and improve performance as highlights of their time with their fund. Other respondents listed allowing management to execute and avoiding micromanagement as positives, and believe that overly frequent meetings and heavy-handed management detract from success. 

“I recently talked to a PE firm with a 30-person operational team who admitted they could be “difficult” to work with given how involved they are in the operation,” says private equity advisor, board member, and former CEO Bill Hewitt. “In the same week, I met with a firm that did not employ operating advisors because they believe it to be an insult to management.” 

What one candidate finds overbearing, another may view as invaluable, and vice-versa. When you’re diligencing a role and getting to know more about your potential new sponsor, keep all of these factors in mind and consider not only how you view your skills, but how you will execute in the operating environment.