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So Youre A Private Equity Advisor, Now What?

Okay, you met one of the two criteria to become a private equity advisor, which is to have been in the c-suite of a business that grossed over $100 million dollars a year, or to know someone who has. (Again, for those starting with this page, knowing me qualifies you.) Now what? I have been involved in successful (and unsuccessful) buyouts, partnerships, mergers, and acquisitions and I have learned the one key element necessary for success as a private equity advisor and I will tell you below in narrative form.

Mickey, Larry, and Wayne were all successful executives with minor league sports teams. Some weeks back, they thought they would all become private equity advisors and get rich. I have been coaching them on how to select and back test industry-segments and to create value in the acquisition targets so that they are able to sell their expertise to a private equity firm.

We were all seated at a table discussing how things were going. Each had investigated and studied potential targets and had developed lists of their targets. Besides one professional sports retail-company, ProAllStars, and one dietary and fitness company, WeightLossTribune, no one had called anybody.

I was a bit surprised by this.

“So,” I said, “Besides the two companies you all have been talking about for a month, you have not called another company?”

They all sat back a bit, frightened by my incredulous tone.

“I have just wanted to make sure I had enough information about their company, my plans, the numbers, that sort of thing,” said Mickey.

The others voiced their agreement.

“You had identified an initial list of about five companies after the first week.” I said. “I thought I made it pretty clear that to be successful, you had to call them repeatedly, like twice a week as you expanded your list.”

“You did,” said Wayne. “You said it would take about 11 calls on average before we would even get to talk with the primary decision maker. I just wanted to make sure I had all of my ducks in a row first.”

I waved my hands in front of my chest trying to stop the conversation before it got away. “The single most important part about being a private equity advisor is to make the calls. You have to be persistent. There is no failure that cannot be turned around by persistence. So, start calling. Get it?

“Yes, I think we do,” said Larry looking at his cohorts. “Can I ask one more question?”

“Larry, I usually ask if their are any more questions when I am done, but today I am not going to answer any. Write it down. I promise I will answer it next week if you have made your calls. Calling is the single most important thing about being a successful private equity advisor . You can backfill all the other stuff later.”

Then I smiled at each of them and got up from the table and left. I hoped my theatrics had not been too over the top, but these guys need to not waste my time, and start.

Thanks for Reading,