Mid-market private equity funds build internal value creation teams to support portfolio companies with critical functions like hiring. These teams leverage established processes and headhunter networks, enabling a new CEO to build an executive team far faster than they could alone.

The initial focus post-acquisition depends entirely on the CEO's background. An existing, internal CEO requires relationship-building with the new PE owners. A new, external CEO, already aligned with the firm, must focus on building trust with the company's existing team.

When capitalizing your business, select investors for their experience, not just their money. Prioritize people who have a history of successful exits. They provide a proven playbook you can model your business against and, as partners on your cap table, their strategic influence is critical to your journey.

Instead of hiring traditional consultants or arm's-length operating partners, Transom's core strategy is to bring the best-performing CEOs and CFOs from its successful, exited portfolio companies in-house. This ensures perfect alignment, proven working chemistry, and deep, practical expertise in executing the firm's specific playbook.

Rather than competing in crowded auctions, elite private equity firms pursue a differentiated "executive new build" strategy. They partner with proven operators to build new companies from scratch to address a market need, creating proprietary deals that other firms cannot access.

If you've had past success with a CEO, it's a strong indicator of their talent and execution ability. Following them to their next company, as one investor did with a CEO across three separate ventures, can be a highly effective investment strategy that leverages a proven track record.

The value creation journey begins with the end in mind. Private equity firms immediately consider who the eventual buyer will be—a strategic acquirer or another PE firm—and tailor their operational improvements to meet that future buyer's specific criteria and overcome their likely objections.

Rainwater's method was to find a great business with poor management, acquire a stake, and then use his influence to install a world-class leader. He did this with Disney by bringing in Michael Eisner, believing the 'fix was just really easy. All he had to do was change the CEO.'

Contrary to the idea of a rigid, leather-bound playbook, value creation in private equity is more like a Cheesecake Factory menu. It offers a vast array of options, and the right "dishes" (initiatives) are selected based on the specific needs of each portfolio company, accommodating any situation.