Corporate development at a PE portco
So, I recently received an opportunity, via the financial sponsor, to work for one of their portfolio companies.
Background:
I currently work in TS for a MM accounting/consulting firm. A long time PE client whom I have worked very closely with is working on developing an internal ‘Corp dev’ team. essentially, the idea is to establish a team, at the fund level, to run/execute all of the add on acquisitions to their existing and upcoming platform investments. So significant exposure to modeling/ valuation/ diligence and ultimate execution. I would spend the first 3-6 months being trained in house by the PE and then would sit at the new platform holdco.
As this is an entirely new thing, the idea is to start at their newest platform but down the road, at the onset of a new fund, bring the ‘Corp dev’ team to the fund level.
I am curious if anyone has any information to share or thoughts on such a position.
Also, what sort of questions should I be asking? I have flushed out most of the basic ones as 1) I have worked with almost all of their deal teams very closely, and 2) worked on the acquisition of the portco in question.
From my perspective, it seems like an incredible opportunity to transition from being a service provider to actually managing and executing deals.
That's pretty crazy and interesting. First, I've found that add-ons are about 80% of the same work (and learnings) as much bigger platform acquisitions. So, it's pretty similar to full blown PE.
I don't get what you mean by "sit at the new platform holdco." That means you move to the actual portco? That doesn't seem to make sense - you'd basically be moving from PE to corporate development, which makes it seem unlikely you'd move back.
Questions you should ask: am I going to be expected to shift from PE firm to portco back to PE firm? Will I have to move to the city with the portco? Also, who pays the salary if I am at a portco? (you wnat it to be the PE fund not the portco becasue then they may not move you back).
DZZ , appreciate your note and thanks for the explanation on similarity of work between add-on/platform deals.
And apologies, it's a little confusing as this is an entirely new structure that is being developed in real time. Couldn't agree w/ your questions more, I have thought of the same. It is unclear if I am hired through the portco or fund at this point. I believe, based on fund structure, they may have to stick me on portco payroll..
To explain, they are planning to eventually develop a 'shared service' between the portcos. Whereby, I work on add-ons across the entire fund's portcos. The shared services would likely include 3-4 individuals.
The plan is to essentially make me the test subject for this structure. My biggest concern is getting 'stuck' at a portco or a change of direction on part of the PE to not develop the 'shared services' team.
Yea it's a little confusing - are you hired at the fund or at the portfolio company?
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