The private equity (PE) industry is navigating a sluggish 2024 market, influenced by high interest rates, economic uncertainties and a slowdown in deal activity. Although fundraising has declined, assets under management are piling up. With $3.2 trillion in unsold assets, 46% of which have been amassing over four years or more, the primary challenge for private equity firms is to unlock these investments (Bain).
It’s an exacting environment that requires PE firms to revamp their approach to value creation and increase ROI. Modernizing, refreshing and growing a brand to enhance market appeal and maximize returns is often a formidable challenge. It’s essential to ensure that these efforts reflect genuine, substantial improvements and not superficial changes that amount to putting lipstick on a pig.
This imperative can be complicated by the need to align an investee company — its leadership, culture and positioning — with that of the parent firm, a hurdle that is further compounded by the dynamics of any entities involved mergers. Then comes the difficulty of identifying and reaching buyers who are aligned with the acquired business and communicating the market potential.
This is where strategic B2B sales and marketing come into play, helping PE firms articulate distinctive value and demonstrate the unique benefits and synergies of a portfolio company to customers and potential buyers. A go-to-market strategy that involves rebranding, coupled with stakeholder engagement and leadership alignment, ensures smooth integrations and preserves brand equity. A brand launch leveraging targeted marketing campaigns enhances reach and engagement.
Implementing these sales and marketing strategies positions PE firms to navigate the complex market, enhance the attractiveness of their portfolio companies and achieve higher returns on their investments. Traditionally, however, PE firms have relied more on connections and networks rather than marketing, often viewing it as a necessary evil or an avoidable expense. The additional cost and the hassle of aligning stakeholders pose substantial barriers.
Overcoming these obstacles requires a B2B marketing firm that understands the dynamics of stakeholder teams and adopts an empathetic approach to foster collaboration and alignment. Through integrated systems, communications, and sales enablement and empowerment, an experienced agency strengthens marketing and sales teams. When executed effectively, B2B marketing can increase the value of the investment and maximize ROI on exit sales, making it a critical component for success.
This article examines how PE firms can leverage the power of a B2B sales and marketing strategy to identify and differentiate the strengths of their portfolio companies, gain leadership buy-in, amplify worth and attract high-value investors.
Comprehensive Go-to-Market Strategy for PE Investments
Identifying and differentiating strengths
One of the primary challenges in PE investments is understanding the distinct strengths and market positions of portfolio companies. B2B marketing offers a unique lens through which these strengths can be identified, articulated and leveraged. By conducting thorough market research and discovery, B2B marketers can help PE firms develop a deep understanding of a portfolio entity, readying it for sale or greater value creation.
Market research for PE investments involves:
- Competitive analysis to identify market gaps and opportunities
- Gathering data to understand customer preferences, pain points and expectations to shape brand messaging
- Brand audits to assess resources and capabilities, as well as the current perception of each brand to identify areas for improvement and alignment
- Internal collaboration to engage stakeholders, understand their core values, address their concerns, and ensure cultural and operational alignment across acquired brands
These insights inform the development of a cohesive rebranding strategy that communicates the vision, values, strategic benefits and growth potential of the business to teams while differentiating the brand in the marketplace.
Developing brand messaging and creative
Through the expertise of a B2B marketing agency, a PE firm can craft a clear, compelling brand message that highlights the strengths and unique selling point of the portfolio company. The information gathered during the market research phase will aid in crafting a story that resonates with existing and potential customers. It will also aid in the development of a strong visual identity, including a logo, color scheme, imagery and brand guidelines. These elements can then be incorporated into all marketing collateral to build brand recognition and consistency.
Building a digital presence
An effective sales and marketing strategy includes the creation of a professional website that reflects the new brand identity and values, and that articulates the strength of the entity, highlights its growth potential, and showcases the integrated power of any mergers. A dedicated section should be created for investors that provides detailed financial data, performance metrics and strategic plans. Search engine optimization (SEO) and search engine marketing (SEM) will increase visibility among potential buyers and investors.
Targeted advertising, PR and email campaigns can amplify reach while showcasing the enhanced capabilities and offerings of the brand, fostering trust and generating interest with existing customers, potential investors and buyers. Thought leadership and multimedia content can help increase brand presence and authority while highlighting the entity’s market position, industry insights and strategic initiatives. Building a digital presence includes tactics such as using data analytics to identify and segment target audiences, tailoring personalized content to engage these segments, and employing metrics to continually assess and refine the effectiveness of campaigns.
Empowering sales teams
A comprehensive suite of sales assets, such as pitch decks, sell sheets, brochures and playbooks, ensures sales team consistency and effectiveness in communications between stakeholders and existing customers. Additionally, sales enablement supports consistent and transparent messaging with potential buyers and investors across all channels, including industry and investor events. These tools equip the combined sales force to drive growth and achieve a successful exit.
Launching the brand
An effective brand launch involves meticulous planning and execution. A B2B marketing agency plays a pivotal role in generating buzz and awareness around the brand by crafting compelling teasers, coordinating impactful announcements, and ensuring a strong presence at events and roadshows. This approach amplifies the brand’s reach and impact, effectively capturing the attention of the entity’s existing and prospective customers. It has the added benefit of driving interest and engagement with potential buyers and investors, fostering strong market connections.
Attracting buyers or investors
The ultimate goal of PE investment is often to maximize returns through a strategic exit. An effective go-to-market strategy adds significant value to an acquired or invested entity by effectively positioning the new brand in the market and communicating its strengths and market position. By retaining existing clients and securing new ones, it increases the attractiveness of the business to potential buyers and investors. A B2B marketing agency can further assist PE firms in identifying and targeting buyers and investors, increasing competition and achieving a better return.
Case Study: New Heritage Capital Merges Three Successful Brands
A prime example of successful PE marketing is the case of New Heritage Capital’s investment in Welcome Dairy, Gamay Food Ingredients and North Star Processing. These three established companies in the food ingredients, seasoning and processing sectors were brought together under a cohesive brand and launched into the market with the help of Elevation’s strategic go-to-market support.
The approach
Market research and discovery helped marketing teams understand the nuances of each business. These insights were used to develop a cohesive and energetic brand identity –– Revela Foods –– that unified the three companies and effectively communicated their value proposition. Stakeholder workshops facilitated collaboration between leaders of the three companies and ensured team members were aligned with the new brand vision. Vital sales assets, including a new website, email campaigns, event support, sale sheets and playbooks ensured a successful brand launch.
The results
Through a strategic rebrand and brand launch, New Heritage achieved a significant lift in the value of the combined entity. This go-to-market strategy resulted in a strong brand that effectively communicated the unique appeal of its diverse flavor ingredients and solutions to major brands, retailers and food services. The result? Nearly $250 million in projected sales in the first year. Revela was subsequently sold to a multibillion-dollar food company, delivering an impressive ROI. This result showcases the tangible value that strategic sales and marketing can provide to PE firms.
Get Better Returns for Your Exits
In today’s slow-moving PE market, B2B sales and marketing are more than nice-to-haves. They’re strategic assets that can significantly enhance PE sales. By leveraging market research to drive your brand strategy, securing leadership support, developing sales enablement tools and crafting compelling campaigns, an experienced B2B agency can help your PE firm distinguish its investments, drive higher valuations and achieve successful exits.
If you’re ready to amplify your sales strategy with comprehensive go-to-market support, contact our team today to learn how we can drive more business wins for your PE investments.