Personnel push: GPs beef up deal-sourcing and operating teams
Sourcing and operations staffers are in particular demand since firms need to find proprietary deals and move quickly to improve the companies they acquire.
David M. Toll
Russell Reynolds Associates Consultant Heather Hammond was featured on the cover of Buyouts magazine. In the story, "Personnel push: GPs beef up deal-sourcing and operating teams," she explains why growth-equity firms are eager to hire deal sourcing and operating experts. The article is excerpted below, or you can read the entire article here.
Buyout and growth-equity firms continue to hire talent at a rapid pace this year, driven in part by strength in fundraising and by the growing need to extract bargains from a white-hot market for deals.
The sale of minority stakes by firms, often a precursor to diversification, has also fueled hiring.
Heather Hammond, who recruits for mid-market and large-cap firms as a partner in the financial-services practice at Russell Reynolds Associates, described as "fairly robust" her firm's business of hiring principal-to-managing-director professionals this year.
Executives with expertise in deal sourcing and operating businesses are particularly sought-after, she said, given that firms need to find proprietary transactions and make rapid improvements in portfolio companies once they are acquired.
"My sense is that we're obviously at the end of a cycle," Hammond said. "Firms have raised a decent amount of money. They want to be able to put that capital to work sooner rather than later."
Marcks and Hammond both said that a desire to diversify into complementary businesses such as credits and special situations has also contributed to the crush for talent.
Such hiring often comes in the wake of selling a minority-stake investment to an outside firm, which can produce capital needed for the expansion. Diversification can also come in anticipation of such a sale, to make the firm more attractive to investors.