PrivateEquityCXO and Falcon Partners have unveiled the Top 50 Private Equity Firms of 2024, recognized for their governance approach, engagement, and compatibility, which greatly empower executives within portfolio companies to excel. These firms were selected based on input from over a thousand sponsor-backed executives, who shared their firsthand experiences and assessed funds across the Nine Dimensions of Governance Fit®, a strategic framework aiding executives and sponsors in fostering partnerships conducive to superior ROI.
The significance of governance fit cannot be overstated, particularly in determining the success of a partnership between executives and sponsors, pivotal for maximizing company growth. In today’s landscape marked by volatile economic conditions, political uncertainties, and stringent credit markets, achieving optimal partnerships becomes even more critical.
Beyond honoring the Top 50 Firms, the report delves into data-driven insights elucidating why governance fit is paramount for investment success. Notably, 80% of talent-focused portfolio companies met their first-year objectives and attained a 2.5x ROI, underscoring the correlation between governance alignment and performance.
Key findings from the report include:
- 59% of executives prioritize a robust investment thesis as the most crucial attribute of any PE sponsor.
- A practical investment approach emerges as the primary factor in executive retention, with 92% of executives disinclined to return to sponsors neglecting economic realities in their strategies.
According to Lindsay Guzowski, Falcon Partner, “Governance fit is perhaps the most critical element in determining whether a partnership between executives and a sponsor will drive maximal company growth. When it comes to human capital, the stakes are high. It’s nearly impossible to have a successful investment if you don’t have the right management team players on the field.”
Discover the insights and winners of the 2024 Top 50 Private Equity Firms for Executives, and gain invaluable guidance on establishing alignment for success in private equity. Access the complete report here.
This research represents one of the many initiatives by PE-CXO and Falcon aimed at nurturing elite PE portfolio company leadership, ensuring a prosperous future for private equity.
