Talent and Leadership

• Nearly 70% of PE backed CEOs get replaced during the average hold period, a pattern Claymore Partners ties to conflicting board mandates rather than a talent shortfall
• 64% of new CFO appointments this year went to first timers (Russell Reynolds), and 59% inherited a finance function that had to be rebuilt first (The Barton Partnership)
• EY finds people related issues are the most common source of early value creation delays, yet HR is still typically brought in only after the deal closes
• McKinsey reports 60% of PE operating groups are now involved during diligence, and operating group size has more than doubled since 2021
• Search practitioners report the MBB badge carrying less weight in portfolio company hiring as clients prioritize operators over advisors
• With over 13,000 unsold PE backed companies in the U.S. and a third held five years or longer, leadership evaluation is shifting to mid hold rather than exit prep

‍

Operational Value Creation

• 58% of PE firms now invest in value creation within Year 1, up from 29% a year ago, as margin improvement drove 51% of 2025 EBITDA growth versus 21.5% pre 2023
• S&P Global finds 71% of PE general partners now prioritize operational improvement over financial engineering
• Bain counts 32,000 unsold portfolio companies worldwide worth $3.8 trillion, with Belgian mid market multiples down to 6.5 times earnings from 8 to 10 times in 2021
• Multiple expansion has collapsed to 8% of PE value creation in 2025, down from 40% before the Fed began raising rates, per Apollo's Torsten Slok
• A stop losing framework is gaining traction: cut dead products, low return channels, and toxic managers before funding new growth
• Keep75's work with a PE backed consumer brand shows fixing leaking existing markets should come before chasing new ones

‍

AI in PE

• BCG, McKinsey, EY, and KPMG disagree sharply on AI ROI, with KPMG finding 79% call AI a top priority while only 7% can show a measurable return
• Eurazeo frames AI defensibility around four moats: vertical expertise, proprietary data, hardware, and regulatory certification
• SaxeCap, which works with over 70 PE firms including 9 of the top 10 by AUM, points to middle management as where AI implementation most often stalls
• PE firms hiring dedicated AI strategy leads are finding the job starts with data cleansing, not modeling
• Alvarez & Marsal's AI ZBO framework redesigns the work itself, rather than automating existing approval chains, to convert AI capacity into EBITDA
• A study pairing fund level and portfolio level executives found one operating partner has never seen AI appear on a scorecard despite years of building them

‍

Deal and Market Dynamics

• Physician medical groups captured a record 46% share of Q1 2026 healthcare deal volume, up 18% year over year (PwC)
• Yorkshire PE deal volumes rose 35% in H1 2026 even as UK wide activity fell 3.4%, with regional EBITDA growth of 47% over three years (KPMG, Real Deals and BDO)
• Bain's Private Equity Midyear Report 2026 finds a deal once needing 5% annual EBITDA growth now needs 12% to deliver the same 2.5 times return
• Domo, Pluralsight, and Instructure ran the same PE playbook, but only Instructure survived because Canvas functions as a system of record universities rarely switch
• KKR extended broad based employee ownership to Spectris, giving 7,200 employees across 36 countries a stake, part of a model now in over 90 portfolio companies
• Stirista, bootstrapped for over a decade before a single $14 million round from Wavecrest, now runs a debt free, earnout funded roll up of founder run data businesses
• LongRange Capital's acquisition of Pizza Hut from Yum! Brands signals how legacy consumer brands are being valued and sold today

‍

Thanks to Lee McCabe, Eiffat Karp, James Griffiths, Liam Grier, James O'Dowd, Matthew Dionne, George de los Reyes, Alex Eck, Aimé Niyigena, David Haarmeyer, Dan Cremons, Brea Page, Scott Engler, Joséphine Nordin d'Arc, William Ekberg, Alexander Sen, Anil Kumar, Markus Schädel, Jon Fidler, Lee Bhandal, Marcello Gracietti, Graig Gröbli, Brendon Beebe, Philipp Freise, Greg Head, and Erik Boender, and everyone else who contributed insights to this edition. Find the full list of posts and voices on LinkedIn: