the value creation plan
What goes in a VCP, how it’s structured, and where marketing belongs with a baseline, an owner and a target.
learn morePE value creation, with marketing measured
Marketing contributes to most of what raises enterprise value. In most VCPs it still has no baseline, owner or number.
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value creation bridge
Hold period · illustrative
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entry ebitdapricingoperationsmarketingexit ebitda
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what value creation in private equity means
Equity returns come from three places: EBITDA growth, multiple expansion and deleveraging. For a decade, leverage and rising multiples carried much of the load. They carry less of it now.
Bain estimates a buyout now needs roughly 10 to 12% annual EBITDA growth to reach a 2.5x MOIC over five years, up from about 5% in 20151. Debt and rising exit multiples used to do much of that work. Today they do less, so more of the growth has to come from the company itself. McKinsey finds sponsors that lead on operational value creation earn 2 to 3 percentage points more IRR2.
where marketing fits in PE value creation
Most plans treat marketing as a cost line. It contributes to more of the EBITDA bridge than that: new revenue, pricing, retention, integration and the exit story.
The problem is evidence. Spend is spread across vendors, each channel reports its own version of the truth, and nobody owns the handoffs between them. So the board can’t tie spend to pipeline, and marketing is the first budget cut when the quarter slips.
where marketing contributes to enterprise value
- New revenue with pipeline traced to source
- Pricing power, from a position customers will pay for
- Retention and expansion, alongside the teams that own them
- Buy-and-build integration: one brand, one site, one CRM
- A documented growth record the buyer’s diligence team can validate
the PE value creation playbook, in five parts
Each part has its own page. Start where you are in the hold period.
- (01)
the value creation plan
What goes in a VCP, how it’s structured, and where marketing belongs with a baseline, an owner and a target.
learn more - (02)
the value creation levers
The four levers marketing contributes to (brand, acquisition, retention and exit readiness) and where each lands on the EBITDA bridge.
learn more - (03)
value creation strategies and examples
Buy-and-build, organic growth, pricing, professionalization and exit repositioning. Illustrative examples of each, and what marketing has to deliver.
learn more - (04)
portfolio company value creation
For the portco CEO, the CMO and the operating partner: marketing’s job from close to exit.
learn more - (05)
value creation consulting
How we differ from strategy firms. They write the plan. We build and run the growth system behind it.
learn more
find where money leaks before you plan
The free Portfolio Marketing Audit is a leak report built from what’s visible from outside (site, search, ads, reviews, response speed), with an estimated cost where the evidence supports one and what we’d validate first inside the business. No call needed.
how much is marketing adding to EBITDA?
The free audit starts the answer: where marketing is likely losing money, what each leak may cost, and what to validate first.
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how we put marketing to work on enterprise value
Diagnosis first. Then marketing is held to the same standard as every other workstream in the plan.
- (01)
diagnose
Within 30 days of close, or at any point in the hold, we test whether the system that produces and measures customer growth can deliver the economics the plan assumes. Where it breaks, what each break costs, and whether it’s isolated or structural. It usually sits between channels, not inside one.
- (02)
rebuild
Infrastructure first, in accounts the company owns: CRM and attribution. Then website and conversion, SEO, paid media and brand, only where the diagnosis says they matter.
- (03)
scale
Once the system is measurable, put capital behind what works. Not before.
- (04)
prove
Pipeline, CAC, CAC payback, LTV and revenue growth, defined the same way in every portco and documented so it holds up in diligence. If we can’t rebuild a number the same way twice, it isn’t in the report.
questions, answered
Something we didn’t cover? Ask it on the audit form.
The work a sponsor and management team do between close and exit to raise enterprise value. Returns come from EBITDA growth, multiple expansion and deleveraging.
Operational improvement: revenue growth, pricing, margin and buy-and-build. With higher rates and less multiple expansion, financial engineering contributes less of the return than it did, so more has to come from the business itself.
Marketing contributes to new revenue, pricing power, retention and the documented growth record a buyer’s diligence team reviews. It belongs in the VCP with an owner, a baseline and a target the board can track, with the accounts and data in the company’s name.
The sponsor’s plan for raising enterprise value over the hold: the initiatives, who owns each one, the targets and a timeline the board reviews.
In the first 100 days after close, so it has the full hold period to compound. Mid-hold, or 12 to 24 months before exit, is next best.
A leak report built from what’s visible from outside the business (site, search, ads, reviews, response speed), an estimated cost where the evidence supports one, and what we’d validate first inside the business. No call is needed.
keep reading
- value creation planWhat goes in a private equity value creation plan, a section-by-section template, and where marketing belongs with a baseline, owner and target. Free audit.read more
- value creation leversThe four value creation levers marketing contributes to in a PE-backed company: brand, acquisition, retention and exit readiness. Get a free audit.read more
- portfolio supportPE portfolio company marketing support: diagnose the growth system, rebuild what matters, report one set of numbers the company owns. Free audit.read more
see where marketing is losing you money.
the free audit
what you get
- (01)
Where demand leaks
Search, the website, speed to lead and paid media: the leaks visible from outside the business.
- (02)
What each one may cost
An annual cost estimate wherever the evidence supports one, with the assumptions shown.
- (03)
What to fix first
Fixes ranked by likely payback for the work involved.
- (04)
What we’d validate inside
The CRM, ad and revenue data we’d check first to turn the estimates into numbers for your value creation plan.
what lands in your inbox
how much is marketing adding to EBITDA?
The free audit starts the answer: where marketing is likely losing money, what each leak may cost, and what to validate first.
Free Delivered by email No call needed