I've walked into enough PE-backed companies post-close to recognize the pattern immediately. The investment thesis was built on assumptions about operational leverage — that with the right capital and strategic direction, this business could 3x. What the diligence didn't fully capture was how far the operations were from being able to execute that thesis.
What the investment thesis assumes
PE investment theses in manufacturing and CPG typically assume: that the company can absorb more volume without proportional cost increases, that systems are good enough to support growth reporting requirements, and that the leadership team can shift from founder-led execution to institutionalized governance. All three assumptions are often wrong.
What they find instead
Reporting that can't support board-level scrutiny. KPIs that exist in someone's head, not in a system. ERP that was implemented a decade ago and never properly optimized. A leadership team that is excellent at running today's business but hasn't built the institutional muscles PE firms need — structured cadences, written decision frameworks, clear accountability chains.
The gap between what PE firms want and what they find isn't usually a strategy problem. It's an operational infrastructure problem.
The 100-day window
The first 100 days post-close set the trajectory for the entire holding period. Companies that use this window to build operational infrastructure — governance, reporting, systems clarity, leadership alignment — consistently outperform those that wait until problems force action. The ones that wait spend their energy on firefighting rather than value creation.
What operating partners can do differently
Pre-close operational diligence needs to go deeper than financial and legal review. Assess the actual maturity of operating systems, data infrastructure, and leadership capability before you close. The cost of an operational diagnostic pre-close is a rounding error against the cost of discovering these gaps in Year 1 of the holding period.
Ready to put this into practice?
Book a 30-minute strategy call. I'll tell you exactly what I'd prioritize for your specific situation.