Asset Management Consulting

Private Equity’s growing interest in Professional Services businesses is understandable, given their cash generation, growth potential, and recurring revenue streams. With competition for assets driving valuations to all-time highs, these firms are undeniably attractive investments. However, many investors in recent times have underestimated the complexities that underpin their success and fail to grasp the fundamentals of how these businesses operate, leading to repeated missteps. One common mistake lies in unrealistic expectations around hiring. Investors’ theses often rely on quickly onboarding large numbers of new Partners and achieving immediate profitability. The reality, however, is far more complex. Transferring client relationships at scale is rarely straightforward, and it can take up to two years for a new Partner to fully embed and begin generating consistent revenue. This “talent lag” is frequently underestimated, as is the impact of non-compete clauses, which can create further delays. Another frequent oversight is the failure to assess the operational backbone of a Professional Services firm. The most successful firms excel in areas such as thought leadership, recruitment strategies, cross-selling, and delivering repeatable offerings. These elements are critical to long-term success, yet many investors fail to appreciate or evaluate them effectively during due diligence, focusing instead on surface-level metrics. We also see many ex-tier 1 consulting Partners, now working in Private Equity, making assumptions about “best practices” based on their experiences at larger firms. However, these individuals often overlook the fact that running a Professional Services business requires a completely different skill set. Operational strategy, leadership, and managing the nuances of people-driven businesses demand a broader perspective than what is gained from delivering client work. Professional Services firms present significant opportunities for investors, but success requires a far deeper understanding of their unique dynamics. These are people-centric businesses and, as such, behave in an almost esoteric manner. Investors who truly grasp these nuances are best positioned to unlock the sector’s full potential.

❗Consulting Market Momentum: Are We Entering a Real Recovery? After a few years of caution and recalibration, the consulting market seems to be finding its rhythm again. Across our conversations with senior leaders in the Big 4, strategy firms, and PE-backed challengers, one consistent message stands out, demand is returning, but the shape of that demand has changed. 🔹 Private Equity activity is picking up as exits and refinancing pipelines reopen, particularly across mid-market funds seeking rapid value creation support. 🔹 Transformation work remains the anchor for most firms. Cost take-out is still a massive part of what’s happening, but we’re seeing more variety, with AI enablement, productivity transformation, and commercial growth playing an increasingly central role. 🔹 Hiring sentiment is cautiously positive. After months of lateral freezes, we’re now seeing acqui-hires and selective Partner / MD hiring across areas like Transactions, Restructuring, Value Creation, and Tech/Commercial DD work. 🔹 On pricing, firms are experimenting beyond traditional time-and-materials, with a growing interest in outcome-based and value-linked pricing models as clients push for measurable ROI. 2026 could well mark a turning point, not the return to the boom years, but a more sustainable, insight-driven phase of growth. #Consulting #PrivateEquity #Transformation #HiringTrends #AI #MarketInsights #PatrickMorganInsights

"Your Next Move with Private Equity: The Kings of Capital" Over the last few weeks, I've been hearing a lot from IT Services, Technology & Consulting companies eager to dive into the #PrivateEquity (PE) space, and wanting to sell (or scale) their offerings into PE portfolio companies (or #Portcos). It is increasingly been thought of as one of the fastest growing non-linear channels of growth (due to its massive $4 T+ size) and there is rising curiosity about this segment. In the video below, I am sharing my own personal experiences dealing with several PE firms and their portfolio companies. There are a few nuances about how PEs operate, that need attention: - PEs are not VCs: PE firms have a distinct approach compared to venture capitalists. While VCs are often about high-risk, high-reward investments, PEs focus on more mature companies, looking for steady returns rather than speculative growth - PEs focus on non-cyclical businesses: PEs typically invest in companies with steady cash flows that aren't heavily influenced by economic cycles - Non-disruptive strategy: PEs don’t seek to disrupt the companies they own but rather optimise them for efficiency and profitability. They work as business partners with their portfolio companies - Execution with experts: The operating groups within PEs often collaborate with consultants, subject matter experts and the wider partner ecosystem to bring precision in execution For those looking to grow their PE centric revenue streams, here are some key takeaways: - Relationships are king: In the world of PE, relationships are everything. They need to be cultivated at the highest levels, meaning the CEO and Board should be actively involved. PEs prefer doing business with people who have been there and done that, who understand the unique challenges of this sector and have a track record of delivering results - Flexibility is crucial: PE portfolio companies are typically a mix of large and small entities, which means you need to be flexible with your offerings and strategies. Upsizing and downsizing, adapting quickly to new realities, and maintaining a nimble approach are all key - Stand out from the crowd: PE firms don't like working with 'me-too' companies. You need to have a clear differentiator—something that sets you apart from the competition and makes you indispensable - No room for error: The PE world is a high-stakes environment where governance, attention to detail, and flawless execution are not just appreciated—they're expected - Proactive and hands-on involvement matters: PEs appreciate a proactive, hands-on approach. They want partners who are ready to roll up their sleeves and dive into the trenches with them I hope these insights help you better understand the PE landscape and how you can successfully engage with it. If you've learned something new or have experiences to share from your own journey in the PE world, I'd love to hear from you!

Most people think investment bankers just take companies public...But for private equity firms, they’re the behind-the-scenes architects of every deal — from sourcing and financing to exit. I broke down the key activities in a slide - what am I missing? 1. ADVISE: Buy-Side Advisory: Advising PE firms on acquiring companies — sourcing targets, valuing businesses, conducting diligence, and negotiating terms. Sell-Side Advisory: Running sale processes for portfolio companies — preparing materials, marketing to buyers, managing auctions, and negotiating sale agreements. Fairness Opinions & Valuations: Providing formal fairness opinions to boards or ICs to validate pricing and structure in M&A or recap transactions. Restructuring & Special Situations: Advising underperforming or distressed PortCos on debt renegotiations, capital structure optimization, or 363 sales. GP-Led Secondaries / Continuation Vehicles: Advising GPs on moving assets into new vehicles to extend ownership or provide LP liquidity. 2. FINANCE LBO Financing (Leveraged Buyouts): Structuring and underwriting senior and mezzanine debt for leveraged buyouts. Dividend Recapitalizations: Raising or restructuring debt so a PE sponsor can extract equity value pre-exit. Refinancing & Repricing: Replacing existing debt with new facilities at better terms or lower cost. Syndicated Loans & High-Yield Bonds: Underwriting and distributing leveraged loans or bonds to institutional investors to fund acquisitions. 3. FACILITATE Exit Advisory (Trade Sale or Secondary Sale): Managing exit processes — selling portfolio companies to strategics or other PE firms. IPO Advisory / Dual-Track Processes: Preparing PortCos for public offerings or parallel M&A/IPO processes. Market Intelligence & Price Discovery: Providing ongoing insights on valuations, multiples, buyer appetite, and timing to inform exit decisions. Liquidity Management (Secondaries at Fund or Portfolio Level): Arranging LP stake sales or fund restructurings to create liquidity for investors.

Fundraising in Europe has fallen to its lowest level in a decade. Private equity firms are now holding assets for an average of 6.6 years. The traditional drivers of returns, cheap leverage and multiple expansion, have become far less reliable than they were just a few years ago. That means one thing: investment returns are increasingly being won or lost through operational value creation. But operational value creation is only as good as the investment thesis it is built upon. The problem is that most diligence processes still focus on validating the numbers. Far fewer test whether the mechanism behind those numbers can actually deliver what the model promises. I think we've become exceptionally good at validating numbers. I'm not convinced we've become equally good at validating the story behind them. Therefore, at Organica, we've been developing a different approach. Rather than blending historical facts, management assumptions and forward-looking models into one narrative, we deliberately separate them. >> First, we establish an audited baseline by independently reproducing every material financial position directly from the underlying evidence. >> Second, we preserve management's case exactly as it is presented, without dismissing it or quietly adopting it as fact. >> Third, we build an entirely independent view using external benchmarks, reference-class data, industry economics and transparent modelling assumptions. Every claim is labelled. Every number is traceable. Every assumption remains visible. And the result isn't simply another diligence report. It's an evidence-based framework that allows Investment Committees to understand not only what the numbers are, but why they should, or shouldn't, trust them. Our latest case study demonstrates this in practice. What initially appeared to be a restructuring opportunity became something very different once every number was independently rebuilt and every assumption was stress-tested. The investment thesis changed before capital was committed, the value-creation plan was re-sequenced, and governance shifted from relying on promises to relying on evidence. If you're involved in private equity, transaction services, corporate development or investment decision-making, I'd love to hear your thoughts. The full case study is below. I'm always interested in discussing how others are approaching the growing challenge of making capital allocation decisions with greater confidence.

AI has quickly become a core part of the Private Equity value creation toolkit. The real shift going into 2026 is in how operational leverage (via AI) is identified & scaled - something no PE firm can realistically sit on the sidelines of. Across PE firms, portfolio teams, and the consultants supporting them, the conversation has matured. This isn’t about tools or point solutions. It’s about where AI strengthens existing value creation levers - and how those levers translate into margin expansion and EBITDA growth across a portfolio. The AI Momentum Partners (AMP) team pulled together 10 must-read articles (see links in the comments below) that take a pragmatic look at how AI shows up across: • Sourcing and diligence • Value creation and operating leverage • Portfolio enablement and scale • Consulting and advisory delivery models around PE What stands out in these pieces isn’t novelty; it’s applicability. They emphasize operating models, capability building, and execution discipline - the work that compounds into durable value creation. If you’re an investor, operator, or consultant working in and around private equity, this list is worth bookmarking. Which of these perspectives best matches what you’re seeing on the ground today? And which AI use cases are you seeing consistently make it into value creation plans - and which still feel more theoretical? #AI #PrivateEquity #Consulting #ValueCreation