Conducting stringent due diligence on any job opportunity is critical to PE-backed executive success. Our second annual report, The Top 50 Private Equity Firms for Executives of 2024, not only unveils the funds whose governance style and engagement best enable their management teams to succeed, but also equips executives with a strategic framework they can use to assess opportunities and determine fit with a sponsor — the Nine Dimensions of Governance Fit®.

Find out why these Dimensions are critical to driving executive success and alignment throughout the hold period and how to diligence for them in the interview process.

1. Investment Thesis

Why It Matters: Executives rely on their sponsor to have a clear, fact-based investment thesis that is both grounded in realistic expectations and malleable in the face of unpredictable markets. Executives play a dual role — challenging and supporting the thesis — making it crucial for sponsors to articulate a solid foundation for the investment while demonstrating flexibility to navigate unforeseen challenges.

How To Diligence For It: 

  • Ask for the reasons the sponsor believes in the deal.
  • Understand commitments they’ve made to their investment committee.
  • Learn the sponsor’s views on the company’s strengths, weaknesses, and priorities for immediate and long-term improvement
  • Define your approach to executing that thesis, addressing those goals for improvement and what strategies you’d employ to achieve them.
  • If a company is mid-hold period, ask the sponsor how the investment thesis has changed since the date of original acq...