Talent Due Diligence with High Growth Tech Company

Overview

A private equity partner was considering investing in an attractive high-growth technology company. With a history of significant growth, an unpenetrated market, and a strong company culture with unparalleled employee retention, the company was being considered for a substantial investment from this successful PE Investment firm.

As the deal was all but signed, investors wanted to ensure the management depth and organization clarity were in place to quickly deploy capital and attain the high growth expectations. Specifically, the deal team wanted to understand the capabilities to leverage and gaps to address immediately following the transaction,

As the deal was happening quickly, the Summit team had one week to assess the organization’s talent and capabilities, key leaders, and make targeted recommendations to the deal team on how to rapidly scale the organization and required changes to be made.

Challenge/Opportunity

The deal team wanted to ensure the company could grow as anticipated and expand globally. The Summit team partnered with the investment team to understand the investment thesis and align on critical talent and organization requirements. The Summit team also established an organization scorecard and began the process to uncover answers and recommendations to questions such as the following:

• How do the leaders make decisions, align on priorities, and collaborate?
• What is the organization design to support growth?
• What is the role of the original founder?
• What do they prioritize first for changes needed for growth strategy?
• Does the management team have the capabilities to scale with the organization?

Solution

From start to finish, we had less than two weeks to assess, analyze and report on the management team capabilities, organization structure and critical recommendations. The process included:

• Establish investment thesis organization scorecard.
• Conduct focused talent assessments on management team leaders.
• Conduct targeted interviews about the organization relevant to strategic alignment, performance focus, management team capability, culture health, and partnership readiness.
• Prepare findings and recommendations for the deal team.
• 1:1 talent assessment debriefs with management team following the transaction.

Outcome

Through our due diligence assessment, we identified organization and talent strengths, opportunities, gaps, and specific recommendations to be taken post-close. This included the following:

• Roles and timing for future management team hires to help fill the gaps for achieving the growth strategy.
• Identified the specific organization design risks and remedies for global expansion.
• Identified development priorities for each management team member assessed included suggestions on how to scale their capabilities.
• Outlined talent risks and mitigation actions for the company growth plan.

Ultimately the Summit team identified near-term talent and organization actions to ensure the growth strategy would be successful.  The deal team made the appropriate changes and investments following the transaction. As a result, the portfolio company closed in record time and is on track to deliver its first year’s growth expectations.