I've been navigating a challenging situation at work and would appreciate some advice from the more senior members here.
For context, as a mid-level investment professional, I took on a high-profile deal in a complex sector with outsized responsibilities for someone my level. I saw this as an opportunity to build expertise in a new area and gain visibility within the firm.
Some time after the deal closed, the business has been underperforming due to unpredictable market factors (hence the complexity). While there are no immediate liquidity issues or covenant problems, it’s unsettling to be behind our underwrite without a clear roadmap to recovery. Adding to the uncertainty, a more senior team member I worked closely with on this deal has since left the firm, leaving me feeling particularly exposed (but also with more significant responsibilities).
To the more experienced professionals out there: how concerned should I be about potential career repercussions if this investment continues to underperform? I know that encountering underperforming investments is likely inevitable, but I’m hesitant to tie my career too closely to a single outcome at this stage. On the flip side, this could be an opportunity to lean in and accelerate professional growth.
Mid-level is an ambiguous characterization of your relative seniority. Are you a senior associate, a VP1, a VP3? It all really depends on how old you are. I'm guessing you're likely a senior associate or a junior VP.
No one is going to associate this "bad deal" with you or your career. It's highly unlikely that you had outsize role in underwriting the deal.
The biggest problem I've seen with this situation is that this underperforming deal takes up all of your time and you don't get put on new deals or other important projects on performing deals. On the hand, it's good that you are now somewhat critical to your firm as you probably know the most about this business...in a downturn where people are not as fixed as they used to be.
My advice is to be all over this business like your life depends on it - every metric, every sales flash, every number - and proactively inform whomever you report to about your views, thoughts and key updates. Once you are seen as competently and capably managing this deal, you may be viewed as a strong performer who should be doing other important tasks. If you can talk to bankers about the space and competitors, and send notes out. Go to conferences and meet competitors, gain insights and send notes out. Talk to former execs from competitors, and send notes out to the team.
This problem portfolio company is your baby and you think about it 24/7, until it starts to perform, and then you can raise your hand for other stuff.
The problem with PE is the pyramid that inevitably forms at any firm...and the senior leaders have to proactively decide who is going to get the mentorship and training to get to the next level. You want to be viewed as someone who is a key part of the future so that you can get the coaching.
My experience is that you really cannot grow in this role unless someone gives you the space to grow into. You will never feel comfortable leading a management meeting or pitching an executive unless someone allows you to do so. They will only allow you to do so when you prove adept at the base tasks.
Bit of a ramble, but this is free advice, so take it or leave it.
Were you the mid-level on the underwrite? I.e - were you leading the discussion during IC or was there a principal or senior VP above you?
If you are THE mid-level and the portco is underperforming so soon out of the gates, yes - you will get consciously or unconsciously tagged with it. It certainly does not help your perceived credibility or judgement.
If you are an associate or senior associate it is fine.
Practically speaking there’s not much you can do other than be as much on top of it as possible. But recognize ultimately being dragged into poorly performing portcos in general is a very asymmetrically downside skewed scenario.
counter to the advice above, my suggestion is be on top of it as much as you can but you need to associate your name with another strong performing asset - either an existing portco or a new underwrite.
As you can probably sense, underperforming portcos are kind of like the ugly step-child if you will - everyone will try to ignore it as much as possible, and eventually, play the blame game.
Ea magni iure nesciunt deserunt odio. Ea laudantium mollitia occaecati ut consequatur delectus qui voluptas.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...