Welcome back to The Private Equity Podcast by Raw Selection! In this episode, Alex Rawlings welcomes back Adam Coffey, CEO and author of the Private Equity Playbook. Adam shares his strategies for scaling businesses, reducing employee turnover, and building strong company cultures. He emphasizes hiring for future growth, addressing employee concerns, and using hybrid work models to retain top talent. Adam also discusses his updated edition of the Private Equity Playbook, offering new post-COVID business insights.

Breakdown:

[00:00] Most Private Equity firms report a success rate of only 20-30% with CXO hires, with 30% being quite rare.

[00:46] Adam, gives us a brief insight into your background.

[01:15] Adam reflects on his time at GE, leading companies through private equity backing, and now helping entrepreneurs grow their businesses.

[04:06] Adam talks about the importance of culture in scaling businesses and the challenge of reducing employee turnover from 41%. He highlights how different regions and employee needs required tailored approaches to address issues and improve retention.

[07:30] He explains how culture, leadership, and people are fundamental when scaling businesses. Having a strong culture ensures employees stay and grow, making talent the key to driving success.

[09:25] Adam dives into how he tackled turnover in different regions, using examples from the Pacific Northwest and Texas, where pay scale and benefits played a role in employee satisfaction.

[12:15] By investing in people early on and addressing their needs, Adam quickly reduced turnover to below industry standards. He explains how transparency and early investments helped build trust and boost employee engagement.

[15:01] Adam discusses how private equity firms struggle with transitioning founder-led companies to PE-backed environments, emphasizing the importance of communicating career opportunities and company growth potential.

[17:49] When acquiring companies, Adam emphasizes how better benefits and career development opportunities within a larger organization can turn acquisition anxiety into employee buy-in.

[19:36] Adam addresses the shift in work culture, particularly after COVID-19, and the challenges and benefits of remote work in recruiting talent nationally.

[23:16] He highlights how businesses can still maintain flexibility for employees while ensuring productivity and accountability. Companies that find the right balance will be better positioned for growth.

[27:24] Adam shares his approach to hiring top executive talent, with a focus on aligning work to be done with the candidate's experience.

[33:01] He stresses the importance of hiring leaders who can guide the company through growth and challenges, even if it means making difficult decisions like upgrading talent.

[38:10] Adam talks about the importance of culture fit when hiring and how toxic employees can disrupt growth.

[41:59] Adam reveals his process for assessing talent within six months.

[44:15] Adam announces his updated edition of the Private Equity Playbook, highlighting new insights post-COVID and why it's been a top read for private equity professionals for years.

To be added to the book waitlist, you can email alex.offer@raw-selection.com

Thank you for tuning in!

You can connect with Adam Coffey on LinkedIn here.

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to alex.rawlings@raw-selection.com

Welcome back to The Private Equity Podcast by Raw Selection, In this episode, host Alex Rawlings sits down with Matt Bodnar, founder and managing partner of Eidolon Capital. They discuss Eidolon’s unique deal origination strategies, including innovative approaches like direct mail, and how their flexibility in deal-making helps them close deals where more rigid firms miss out. Matt also shares valuable insights on long-term investing, inspired by Berkshire Hathaway, and offers top recommendations on business, psychology, and deal-making books.

Breakdown:

[00:00] Matt explains how their market position was inspired by Berkshire Hathaway, leading them to find unique opportunities by being flexible where others are rigid.

[00:12] PE firms often miss out on deals due to their rigid criteria; Eidolon benefits from a more flexible approach.

[00:26] Matt mentions Extreme Ownership as one of his favorite books and shares it with his management teams.

[00:53] Introduction to Matt Bodnar, founder of Eidolon Capital. The conversation covers deal origination, using direct mail, and valuable book recommendations.

[01:21] Goldman Sachs, starting Eidolon Capital, and focusing on lower middle market companies with a long-term approach.

[02:17] Matt identifies rigid deal structures as a common mistake PE firms make, missing opportunities to tailor deals based on sellers' needs.

[03:09] Flexibility in deal-making, like structuring equity rolls and earn-outs, gives Eidolon an advantage over more rigid buyers.

[04:34] Matt shares Eidolon’s broad deal origination strategies, including cold email, LinkedIn, direct mail, and networking.

[07:46] The importance of market positioning and personal outreach from principals to increase deal engagement.

[09:39] Why principals contacting sellers directly makes a significant difference in building rapport and closing deals.

[10:35] Direct mail as an effective, less crowded method for sourcing deals, especially in old-economy sectors like manufacturing and distribution.

[13:23] Eidolon’s brand focuses on long-term investing and taking care of all stakeholders, inspired by Berkshire Hathaway.

[15:16] Eidolon’s flexibility with capital and bespoke deal structures allows them to close deals even in suboptimal conditions where other firms might walk away.

[17:09] How taking a long-term view, as opposed to the typical 3-5 year private equity time horizon, results in better decisions and stronger outcomes for companies.

[19:25] Matt discusses the importance of staying informed on macroeconomic trends, the Fed, and market cycles to understand the broader impact on investment decisions.

[20:48] Book recommendation: How to Make a Few Billion Dollars by Brad Jacobs, a prolific entrepreneur who founded or acquired several billion-dollar companies.

[22:41] Matt shares how deep reading into human psychology and decision-making (Charlie Munger’s Poor Charlie’s Almanac and Robert Cialdini’s Influence) shapes his approach to deals and negotiation.

You can connect with Matt on LinkedIn by visiting his profile here.

To be added to the book waitlist, you can email alex.offer@raw-selection.com

Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to alex.rawlings@raw-selection.com

Welcome back to The Private Equity Podcast, by Raw Selection! In this episode, Alex is joined by Robb Powell, an experienced Operating Partner and former CEO who has successfully built and sold two businesses. Robb discusses the deployment of technology and AI in private equity-backed companies, shares insights on driving cultural transformation, and explores the importance of enabling people for business success.

Breakdown:

[00:00] Robb discusses how private equity firms and portfolio companies can start using AI.

[00:12] Introduction to Robb Powell, an operating partner and former founder and CEO. The episode covers tech, AI, and culture.

[00:41] Robb shares his background and experience with acquisitions, board work, and leveraging technology for business growth.

[01:11] The importance of using technology to drive sales and agility in companies.

[02:06] Common mistake in private equity: focusing too much on finances post-acquisition, neglecting team assessments and aligning people with goals.

[03:33] Robb’s method for assessing management teams, using written responses to understand their thought process.

[05:00] Building a culture of success focused on enabling others and creating referral-worthy work.

[07:01] The importance of having a clear narrative about the value you're providing in any role.

[08:29] Robb’s thoughts on aligning people and driving change in organizations, including when it’s time to let people go.

[11:19] Overview of Robb’s technology and digital transformation work with various companies, particularly in sales and service industries.

[13:41] Robb shares how AI is being used to transform roles, including automating coding tasks in a tech company.

[14:34] Exploring where private equity firms and portfolio companies should start with AI and ChatGPT.

[15:59] Robb’s advice on using AI tools to help businesses innovate and work more efficiently.

[17:54] The future of AI: replacing tasks, not jobs, and making people smarter through automation.

[20:19] The potential of using existing tools to implement AI in businesses without needing large consulting firms.

[21:46] Robb’s current AI project with a high-end wine room business and the value AI adds to search functionality on websites.

[22:45] Robb’s influences and recommendations for books, podcasts, and thought leaders, including Acquired and Peter Diamandis’ work.

[26:04] How to connect with Robb Powell via LinkedIn.

You can connect with Robb on LinkedIn by visiting his profile here.

To be added to the book waitlist, you can email alex.offer@raw-selection.com

Thank you for tuning in!

To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.

Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to alex.rawlings@raw-selection.com