Command a premium above your competitors
A well-known saying goes, "Old keys don't open new doors." For CEOs in private equity-backed portfolio companies (portcos), rebranding is the new key that helps unlock new doors for themselves and their company.
John Myers of Kensington International noted in an article in HarveyCareers that "the acquisition of a company by a private equity firm is a seismic change for its leaders and employees." Therefore, it is imperative for the CEO of a portco to rebrand.
Why is there a need for CEOs to rebrand?
According to McKinsey & Company, CEOs of PE portcos face a leadership challenge unlike any others as they are expected to “master everything a great public- or private-company CEO does while operating at a higher metabolic rate."
In fact, in a report by Russell Reynold Associates, they described how private equity boards expect its portco chief executives to have a more robust skillset so they start strong from the get-go when situations call for juggling priorities, achieving consensus and being even-keeled even when the external environment is mayhem at pre-IPO. In these cases, CEOs need solid messaging and map out how the company and its senior executives will present themselves in public from day one onwards.
Whether you are a newly appointed CEO or the CEO whose job is to attract the right investors or the right media coverage for your organization, your personal brand is a valuable asset that will open the right doors to the right organizations. It will also help to build trust, rapport, and engagement with your executive leadership team and other employees inside your organization.
How is CEO branding relevant in the PE board dynamics?
HarveyCareers noted how board interaction in a PE firm is different because most of the directors also serve as principals. McKinsey & Company noted in the article, “Climbing the private equity learning curve” that board of portcos “tend to systematically take a co-leadership role with the CEO on important topics.” This means that PE board members feel like owners themselves as the PE firm owns a majority of the stock. Since most PE portco boards are younger and smaller than public-company boards, the active engagement of PE boards can get some getting used to.
Not all portcos fall into this category. New acquisitions are purchased for many reasons. For instance, a company recovering from bankruptcy, a turnaround situation, or a growth-focused company with an eventual strategic sale or IPO. Portco CEOs have a tremendous challenge in front of them: garnering the trust and support of the holding/PE company.
If the CEO is new to the company, is an internal appointment or the portco incumbent CEO, they will benefit from a performance-optimization process, such as rebranding. It is important to develop key messaging so that the CEO can more easily negotiate with industry peers, especially when the portco enters a new tier in the business marketplace.
Building visibility and trust with the board through rebranding is essential for a successful PE portfolio company. A savvy CEO will leverage a clear and strong personal brand to align core values, the PE firm's requirements, and the portfolio company's needs to drive performance in a shorter timeframe.
Your CEO brand transcends the board and capital markets, investors, customers, and industry regulators thereby simplifying key messages while enhancing confidence with a consistent brand voice. As Forbes opined, "Business isn't just business-to-consumer (B2C) or business-to-business (B2B) anymore. It is human-to-human (H2H)". The confused mind makes no decisions (to buy, invest, engage), so the more realistic, consistent, and authentic the message is, the more likely the customer (or other stakeholders) will engage, purchase, etc.
CEO Rebranding Raises Visibility
Rebranding the CEO involves aligning the messaging with what's needed to raise the company's visibility and build trust. However, getting the right message in front of the target audience is crucial, using a strategic blend of thought leadership through social media, speaking engagements, publishing, and public relations.
To illustrate, I recall the interview with Kylie Wright-Ford, CEO of The RepTrak Company, a reputation data and insights company backed by PE company Catalyst Investors. For Wright-Ford, running PE-backed companies is “the best job in the world,” and she has led three of them. In "Redefining Corporate Reputation with Purpose", Wright-Ford shared evidence of the strong correlation between CEOs and corporate reputation and affirmed that leveraging a CEO brand can bolster a lasting impact on the company. She urged companies to form a strategy around their CEOs, pointing out that the "silence is golden" rule has no place in the modern corporate world.
At Westgate, we enable CEOs to effectively overcome internal and external scrutiny to acquire the right investors that would not have been possible otherwise.
For example, internal CEO appointments with little or limited visibility in the markets will be overlooked and unseen. A strong message positioned appropriately signals to the market that the CEO understands the unique challenges facing such companies. Investors, suppliers, and most importantly, new customers will understand this positioning statement and act accordingly (purchase, invest, etc.).
A position statement such as:
"CEO with experience serving Fortune 50 customers".
Many new CEOs and their boards underestimate the power of simple and clear messaging because it can speed up decision-making to close deals faster.
Most PE firms have a 3–5-year window to get portco to a successful exit. Time is money and money is time.
Some PE companies fail to consider the perspective of other stakeholders. For example, what does Wall Street need to know? What do customers need to know? They are vastly different audiences with vastly different needs. The wrong message to the wrong audience can spell disaster when potential investors don’t see the value.
Janice was an internally appointed CEO without the CEO-level experience of many of her CEO peers. The board requested that she engage with an external resource (Westgate) to assist with her onboarding to establish her personal brand and enhance her presence internally and externally.
Her ability to negotiate multibillion-dollar agreements with the federal government, including ministers and deputy ministers, other senior members of the federal government, the board of directors, and the executive team, was pivotal to her success as a new CEO.
Not to mention the massive change required to refresh the organization with a new organizational design and adoption of digital management systems to address the legacy operating challenges posed by the global pandemic.
Recognizing Janice’s success as a newly minted CEO, she was nominated for and won “Canada’s Top 40 Under 40”, a dynamic awards program that identifies outstanding young achievers in Canadian business, visionaries, and innovators changing the way things are done.
Westgate’s CSOP Improves Capacity Through Rebranding
Westgate's C-Suite Optimization Program (CSOP) helps in the rebranding of CEOs. The process starts with assessments, including 360Reach survey, DISC, Motivators, and Network 7. These processes help to unveil critical themes that are true for the client 100% of the time, which takes the guesswork out of what to say.
The next step in the CSOP process is regarding the audience: Who is the CEO targeting? Is it the capital markets, board of directors, or government regulators? Or all? We then uncover signature stories that the CEO can customize for each audience. Our team refers to it as “free two birds with one key.” It amplifies effort and capacity while building confidence and ease for the new CEO.
As a final step, we guide CEOs on how to maintain their public image through thought leadership. In the long-term, we help them build capacity, improve performance, save time and avoid costly missteps that are common among new portco CEOs. Signature stories become a public platform for building visibility and influence in the marketplace. There is no more powerful way to get the attention of your target market.
For example, we help CEOs increase negotiating power, gain the trust of the board, the LPs and garner the attention of institutional investors. The CEO's personal brand becomes a value driver for the exit (sale) of the portco.
If you’re a private equity investor operating partner
When newly acquired companies onboard a new CEO or promote a key player into the CEO role, there can be an adjustment period before the CEO gets up to speed. Key messaging to the board, the marketplace, suppliers, customers, and especially employees need to be on point to gain alignment faster. This will engage employees to crystalize their commitment during this massive time of change. Your CEO will appreciate the support of a trusted and confidential resource to help with the transition period.
If you’re a newly appointed portco CEO
It’s an exciting time! There are many things happening at once, and if you’re a first-time organizational leader, your relationship with the board and the PE fund is critical. Board members have high expectations for peak performance in a short window of time. You can optimize and accelerate your performance with a personal branding process that helps you stand out in the busy marketplace as you position the company for turnaround, growth, or IPO.
Your brand speaks for you when you’re not in the room. What does your brand say about you?
Do you need guidance on your personal branding process?
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