Timeliness the key to value-add – AVCJ Forum

"Particularly in volatile times, you need to have a mindset of being extremely proactive and taking action before you need to," said James Ahn, managing director of CD&R Asia. "If you're forced into a position where you have to take action, you're already in trouble."

This view was reinforced by suggestions that outlying political, economic or social events during the course of a given investment horizon were inevitable. These factors were found to be capable of impacting businesses at both a macro and local level, but delayed exit plans could be avoided through a focus on reacting early.

"You plan for five years, but it's going to be seven unless you do something different - that knowledge has led to a focus on time as a metric and rapid results. Never be in a position where you have to take the whole portfolio through a big black swan event." said Nicholas Bloy, co-founder at Navis Capital Partners. "We're very oriented now around speed."

Expectation management when dealing with founders was also identified as an area GPs had to address with speed. "The minute you think you have the wrong person, you're six or 12 months too late," said Edward Sippel, co-head for TA Associates in Asia, adding that his firm would tell a founder one month before closing a deal if a leadership change appeared needed.

"Moving quickly is important because usually we get called in pretty late, particularly with minority situations, it's almost a last resort," said Oliver Stratton, co-head of Asian operations for Alvarez & Marsal, a group that helps PE firms drive operational and financial performance improvement in portfolio companies. "The later it is, the fewer options you have. There's less cash, and you really get constrained by that."

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• Topics
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• GPs
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• AVCJ Events
• Asia
• Navis Management
• TA Associates
• Alvarez & Marsal