Private Equity Value Creation
It can be difficult to continue a company's growth after investment. However, understanding how to develop an effective value creation plan can result in a faster return on investment and continued growth in the future.
At Revenue Management Labs, we understand how to conduct private equity commercial due diligence to enhance your business portfolio's value. You can trust our team of revenue growth consultants to effectively map out a strategy for ongoing advancement.
What Is a Value Creation Plan?
A value creation plan is a private equity firm's strategy to optimize a company's growth. This type of business analysis quantifies the organization's potential value over time and the cost to execute the plan.
With value creation plans, a private equity company creates an overview of initiatives or prioritized actions that will facilitate a more profitable industry. These key actions can include internal and external resources, operating and financial metrics, numerous capabilities and the governance framework. Combined, these actions result in the company reaching its full revenue management potential and becoming more profitable and valuable.
Developing a value creation plan at the beginning between private equity sponsors and a new business is beneficial for multiple reasons. A strategy increases the sponsors' confidence and leads to an immediate increase in value from the first day of the deal. Overall, value creation plans map out a realistic strategy tailored for a specific business.
What Is Private Equity's Role in Value Creation?
Because private equity firms invest in new or already established businesses, having a value creation plan for each company is important. It will create a strategy for each investment, resulting in a faster ROI.
For private equity companies to make smart, well-informed decisions, outside sources can help guide their investments and value creation plans. Experienced consulting services can lead to a private equity firm's business portfolio enhancement.
At Revenue Management Labs, our private equity commercial due diligence services include:
- Creating a winning strategy: We will analyze your company's goals and competitors to map out a structured framework that will increase revenue.
- Conducting a thorough analysis: Using top-of-the-line data analysis services, we will analyze your company's competitors and make well-informed decisions.
- Executing a research plan: To create an effective plan, we will conduct research to provide insight into consumer buying habits in your company's industry.
- Instituting a training program: For your company to continue its development, we will train company employees for constant and sustainable growth.
How to Buy, Build and Sell Your Private Equity
Revenue Management Labs has a strategy during every stage of the deal cycle to maximize your investments and grow your business portfolio. Our capabilities and investment knowledge are extensive, so you can be confident in knowing we will generate the best return on your investments through our three-stage process.
By having a detailed plan for every stage of an investment deal, we can ensure you receive a maximum return on your profits and build an even stronger and more profitable business portfolio. The three stages in our process include:
- Buy stage: From the first stage of the investment cycle, we create concrete plans to drive value. We also identify the key drivers to estimate the company's baseline performance versus conventional hockey stick projections. Lastly, we slash revenue pools that are not worth the investment.
- Build stage: During this stage of the deal, we quickly implement the plans from the first phase to drive top-line growth and positively impact financials. We also institute a revenue management process to ensure oversight and accountability.
- Sell stage: In the final phase, we maximize the investment through our deep analysis of financial projections and our thorough understanding of how to create a return on investment in the deal cycle.
These stages detail our analysis of your investments and display how we create a plan to maximize your returns during the first stage of the investment cycle. By following the buying, building and selling stages, we ensure we maximize each investment's value so you can feel confident about each investment and its financial projections.
Contact Revenue Management Labs for Business Portfolio Enhancement
At Revenue Management Labs, we have an experienced team of revenue growth consultants who understand how to create realistic and effective value creation plans for numerous clients. To enhance your business portfolio's value, trust us to create a strategy that will increase your clients' growth and create a faster return on investment. Our thorough research process and years of experience will result in long-term, sustainable expansion to optimize your investments.
For more information about our business portfolio enhancement services, contact us today for a free consultation.