I have decided to launch an article series on the dynamics of today’s ownership by a private equity fund. My focus will be on those situations where a fund holds a majority stake and wields significant influence over governance, strategy, and people topics in a portfolio company. The spotlight will be on the CEO’s perspective.
My objective is to highlight the uniqueness of leading as a CEO in a private equity-owned business. Today’s environment demands more than just leadership; it requires the ability to collaborate with an active fund and navigate toward a successful exit within a typical 5-7 year investment horizon.
The New Private Equity Landscape: Shifting Foundations
Public and private markets have switched lanes in recent years. Since 2016, private markets fundraising has overtaken equity issuance in public markets. The trend has only accelerated, driven by:
Highly leveraged deals are on the decline, now averaging below 50%, despite the era of historically low interest rates. PE firms today are turning their focus toward foundational companies; those offering infrastructure, core services, and stable product lines with higher barriers to entry.
This new focus brings greater emphasis on selectivity across industries, geographies, company sizes, and stages of development.
From Passive to Active: The Evolving Private Equity Operating Model
Gone are the days when private equity simply bought, sold, and split companies to extract quick wins. Today, many PE firms adopt an “active ownership” model. This means:
This shift places even more pressure on the CEO. You are no longer just a steward of growth; you are expected to be an architect of transformation; in your company and even in your business sector.
The CEO in the Crosshairs: Navigating Complexity and Change
The CEO’s journey in a PE-backed company is uniquely shaped by:
In many cases, the CEO transitions from being a seller to a buyer perspective, or from family ownership into an investor-led environment. This shift in accountability and performance expectations can be dramatic.
My Story: From CEO to Coach, with Firsthand Perspective
My experience as a CEO in two PE-backed businesses shaped my passion for coaching leaders in similar positions.
My first private equity experience dates back to before the 2007 financial crisis. I was the CEO of a 50/50 family- and PE-owned company that was later sold. It was a classic passive ownership model: a highly leveraged deal that transformed our focus from strategic planning to managing loan covenants and maximizing short-term cash flow.
Pre-sale, our stable performance and high returns were at odds with inorganic growth demands. We struggled to find value-accretive M&A opportunities, and many due diligence efforts failed. The fund’s focus was on financial engineering over operational excellence or talent strategy.
Contrast that with today’s active PE models, which I now engage with regularly as an industry expert and advisor to PE firms. I see the shift firsthand: funds want entrepreneurial leaders who can execute bold visions, reshape teams, and deliver transformation.
Five CEO Scenarios in PE-Owned Companies
As I launch this series, I will focus on into five recurring CEO scenarios I see in PE-backed environments:
Each of these situations poses distinct challenges; and offers opportunities for growth. Across the series, I will unpack these cases, share insights, and offer guidance drawn from hundreds of coaching hours with executives in similar roles.
Why Coaching Matters Now More Than Ever
The PE CEO role is lonely. Expectations are immense. Stakeholder management is complex. And there are few, if any, internal sounding boards.
That is where coaching can be transformative and impactful:
I bring a unique blend of CEO experience, strategic insight, and empathetic coaching to every engagement. I understand the tension between short-term results and long-term vision, between boardroom performance and team culture.
Let’s Begin the Journey
Whether you are stepping into a PE CEO role for the first time or preparing for another cycle of transformation, this series is designed to support your journey.
And if you are already ready to connect, I would welcome the opportunity. Contact me directly at peter@kapu-care.comor visit:
Let us explore how you can lead with confidence, clarity, and resilience in the high-performance world of private equity.
Whether you are a first-time or an experienced Private Equity CEO, consider how an Executive Coach could enhance your impact and contribute to your, your company, and your team successes. Let’s discuss how coaching can make a significant difference in your journey