{ "docId": "019dd923-5ca1-7489-b635-efee526b2162", "docSlug": "6ebe7bc3c470921e", "documentTitle": "Global Private Equity Report 2015", "authorId": "Bain", "authorName": "Bain", "documentKindSlug": "consulting-deck", "documentKindLabel": "Consulting deck", "sourceTypeSlug": "strategy_consulting", "sourceTypeLabel": "Strategy consulting", "presentationDate": null, "orientation": "portrait", "aspectRatio": 0.773, "pageNumber": 62, "pageCount": 68, "prevPage": 61, "nextPage": 63, "slideType": "key_takeaways", "function": "summarize", "density": "overcrowded", "nDataPoints": 3, "notes": "Page 56 of a Bain & Company report. Contains two numbered sections (4 and 5) detailing management strategies and portfolio optimization.", "elementsJson": [ "paragraph" ], "metadataConfidence": 0.95, "imagePath": null, "slideHref": "/slides/019dd923-5ca1-7489-b635-efee526b2162/62", "deckHref": "/decks/019dd923-5ca1-7489-b635-efee526b2162", "deckJsonHref": "/decks/019dd923-5ca1-7489-b635-efee526b2162.json", "deckAnchorHref": "/decks/019dd923-5ca1-7489-b635-efee526b2162#slide-62", "components": [ { "bbox": null, "kind": "callout", "text": "The payoff from investing to go from good to great by replicating the success of top-performing funds' higher frequency of winners has three times greater impact than trying to lift a money-losing investment marginally above breakeven.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd951-b48c-7655-b301-4e5982eeecd0", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.06, "w": 0.764, "x": 0.118, "y": 0.65 }, "kind": "list", "text": "5 Convert good deals into great ones. Successful portfolio activists take pains to avoid a costly asset-management pitfall—the temptation to double down and try to put a troubled company back on track at the expense of nurturing their winners.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "68f52167-7e19-482d-ac56-f7cf3bea8fec", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.06, "w": 0.764, "x": 0.118, "y": 0.13 }, "kind": "list", "text": "4 Focus on talent and build high-performing organizations. The quality of portfolio company management teams and their ability to drive change is perhaps the most critical—and sensitive—factor influencing a deal’s ultimate success.", "attrs": null, "subkind": "bullet", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "d9de6cfa-23d0-4ca1-8463-117a72084fb8", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.12, "w": 0.764, "x": 0.118, "y": 0.74 }, "kind": "paragraph", "text": "Notably, a Bain analysis that simulated alternative outcomes for a sample of funds that turned in a net IRR of between 5% and 15% during the vintage years from 1995 to 2007 found that the payoff from investing to go from good to great by replicating the success of top-performing funds’ higher frequency of winners has three times greater impact than trying to lift a money-losing investment marginally above breakeven.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "2236bd63-72c6-4e73-9df4-4526bab9aefa", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.15, "w": 0.764, "x": 0.118, "y": 0.21 }, "kind": "paragraph", "text": "Setting up the top management team to succeed and providing powerful incentives for them to deliver from the outset is essential. PE activists must strike a delicate balance between supporting a portfolio company CEO and being prepared to put someone new in the job early on.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "c631a0c5-7c53-4f4d-8aa5-4144a3ab3be7", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.09, "w": 0.764, "x": 0.118, "y": 0.505 }, "kind": "paragraph", "text": "A virtue of the fact that StarBev had begun its life under their ownership as a carve-out was that it lacked a top-heavy centralized senior management. Rather than build one, CVC instead worked to develop strong country-operations teams with local talent.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "c97c7a86-1aa2-4067-8763-02f99cb88209", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.07, "w": 0.764, "x": 0.118, "y": 0.425 }, "kind": "paragraph", "text": "Experienced activist firms anticipate the potential need to take decisive and quick action. 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