Private Equity Playbook

How to Use Outsourcing to Win Big

Private equity has always been a game that rewards the best strategy. TO COMPETE, you have to go in with a private equity OUTSOURCING playbook: one that capitalizes on the strengths of your team, considers the deal from every angle and continuously moves key players into position across and inside your portfolio.

To win, you have to execute your game plan with precision and agility — ready to switch gears if the tide starts to turn — from the kick-off until the final touchdown.

Private equity professionals take on a crucial coaching role, crafting a winning strategy at every stage for an exit that truly outperforms.

That means managing multiple facets that encompass everything from sourcing assets to purchase and crafting a competitive bid in a crowded market to performing due diligence and getting the actionable data they need to make changes and facilitate growth — all while cutting costs and aligning disparate processes across the entire portfolio.

With so much to manage, there is always room for cleaner, more powerful plays in any private equity professional’s playbook, and one strategy, in particular, has the potential to take your portfolio from an overperforming phenom to an undefeated powerhouse: outsourcing.

To win, you have to execute your game plan with precision and agility — ready to switch gears if the tide starts to turn — from the kick-off until the final touchdown. You’re off to a good start with our private equity outsourcing playbook.

Without a Private Equity Outsourcing Partner: Holding the Line

To understand what outsourcing can do, it makes sense to look at the lifecycle of a typical private equity deal over its lifecycle — from acquisition to exit — without it. Most of winning, whether it’s in football or the alternatives market, is all about strategy.

A thoroughly strategized game that looks conceptually sound on whiteboards and PowerPoint slides doesn’t always take the unknown variables of play into consideration, however. Just as a star player might end up on the bench with an injury, or an unexpected overtime could introduce a challenge out on the gridiron, you’re likely to uncover something you didn’t foresee when professionalizing your portfolio companies as well.

A Failure to Execute

When going it alone, it’s often easy to find these potential fumbles in the form of inefficient back-office operations of your portfolio companies, many of which can cause major penalties later in the game:

At the start of any acquisition, you want to realize the full potential of what could be a rising star in your portfolio — taking it from a draft pick to an MVP with a valuation that reflects at the exit. To get there, you should be driving forward with an unstoppable offensive tactical plan — not stuck on defense. Without the agility of fresh plays in your repertoire, you’ll constantly be holding the line, fixed in a reactive feedback loop.

Running Against the Clock

A feedback loop like the one created in underperforming back office processes — especially the ones that tend to plague the necessary but value-neutral processes that cause finance departments to lag behind — will slow growth, no question.

If the benchmark for a strong alternative investment is its weakest element, even a profitable portfolio company with no other glaring issues will underperform when it comes time to tally up EBITDA (earnings before interest, taxes, depreciation and amortization).

In a market where increased demand necessitates ever more competitive bids, surgical cost reduction and rapid growth are required to see the returns that limited partners expect from the investments they make. An aggressive offense that prioritizes efficiency in portfolio companies is what PE firms need to in order to grow these new additions before the clock runs out.

If you find yourself constantly holding the line, it’s time to roll out some fresh plays.

private equity playbook

With a Private Equity Outsourcing Partner: Pushing It Over the Goal Line

So how does choosing a business process outsourcing partner change the game? Just like a smart coach knows that a quarterback is nothing without his offensive line, a strong private equity leader realizes that winning is so much easier with high-quality, back-office support.

Bringing Your ‘A’ Game

By choosing a business process outsourcer (BPO) as your starting line, the challenges that come in the form of managing disparate systems and messy bookkeeping processes against a talent shortage are fixed in the background. Costs can be reduced, inefficiencies streamlined and technology woes solved all with a team that’s talented, cost-effective and assembled to work for you, and only you.

In other words, using an outsourcing provider can turn the game around and put you in control with a winning strategy. Once implemented, you’ll see:

  • STREAMLINED ACCOUNTING PROCESSES across all your portfolio companies
  • done-for-you and delivered without the headache
  • to dedicate to managing and securing new investments
  • UPDATED TECHNOLOGY with more control
  • BETTER PERFORMANCE from your portfolio company CFOs

Pushing it Over the Goal Line

The weak spots in the back-office infrastructure of a portfolio company’s finance department are crushed when a quality BPO joins the team. Your offshore talent can overcome the challenges that keep investors from focusing on growth metrics, and instead, allow your key players to succeed where it matters most.

Diverting money traditionally earmarked for non-value-added departments to those that directly affect strategic growth (like sales and marketing) means that you’ll see the EBITDA at exit that they need to stay competitive going forward: That’s winning in the private equity market.

The solutions a good finance and accounting outsourcer can bring to the table are easily scaled no matter the team’s size — making these plays a smart call across your portfolio companies.

All you need is a firm understanding of how outsourcing works and when to add this strategy to your game plan. This is where our winning private equity playbook comes in.

Systemize Your Portfolio Company’s Accounting Process With Our Private Equity Outsourcing Playbook

It’s not uncommon to buy up an asset that’s been through a number of mergers and acquisitions already. The result? This can often make for accounting processes and platforms that are all over the place. Disparate technologies, poorly documented procedures, and information that’s siloed between departments and business units will have you calling an audible again and again.

During the initial phases of onboarding clients into an outsourced model, the first order of business is synthesizing information and processes across business units and organizational teams. With the right provider, siloes give way to a well-documented, universal set of desktop procedures. This is the time to leave it all out on the field, identify weak spots, and whip the partnership into shape.

Hire a reputable BPO to make process systemization a byproduct of their onboarding process, not a focus of yours and get this task off the bench. The first order of business is synthesizing information and processes across business units and organizational teams.

portfolio companies playbook

Right-size Your Portfolio Company’s Accounting Team

A crucial part of cost-reduction is simply determining which tasks need to be done, and which ones exist solely to keep members of the team busy. Not all work is created equal, and that’s especially true for portfolio companies. Private equity is all about taking a surgical approach — eliminating rework and dedicating in-house talent to business-critical core competencies that add value. Now’s the time to sideline non- essential tasks.

That can mean finding a balance between making the most of your in-house talent without overtaxing them, which will actually slow things down even further.

You’ll have to tackle this problem by asking yourself two things.

The first: “Is this task necessary to stay in business?”

The second: “Does it directly add value and contribute to growth?” Only tasks that fit both criteria should be managed in house. Anything else can be safely outsourced for better inefficiency at a lower cost.

Bookkeeping rework — tasks like accounts payable, accounts receivable, tax, and payroll functions — are all examples of work that meets the first criteria but not the second. Performing this general accounting work is absolutely necessary to keeping the lights on at any business. It just doesn’t add real value or growth to any of your portfolio companies, and certainly won’t get you to the end zone any faster.

What’s more, getting talent to perform these tasks stateside can be a labor-intensive and expensive feat. With as much as 75 percent of today’s CPAs in the accounting workforce estimated to be retired in the next 14 years, and not enough talent coming into the field to replace them, skilled professionals willing to do this work are few and far between — and demanding a premium to do it.

There is another option. With an offshore outsourced model where the talent is situated in the Philippines, investors looking to emerge as champions can do so with a team of world-class accounting talent that adheres to Generally Accepted Accounting Principles (GAAP) for as much as a 50 percent cost savings.

Why Outsource to the Philippines?

This model of bringing transactional work offshore to free up more expensive in-house talent to do the judgement-based strategic work isn’t just for enterprise organizations anymore. Working with a BPO provider that understands the needs of mid-size businesses can provide managers with teams as small as just one. This is not the “lift-and-shift” model of the past.

This is, for all intents and purposes, the addition of as few as a single employee onto an existing team without the usual financial burden of adding one in-house: the BPO provider takes care of the “soft elements” of the FTE hire by providing training, benefits, professional development and more.


The average salary of an accounting clerk in the Philippines is 24,800 PHP, a fraction of the stateside counterpart, making outsourcing to the country a sound financial choice, too. What was once a costly and inflexible model reserved for only the largest company now resembles the addition of just one-star player that integrates seamlessly with your stateside finance department.

Providers with robust onboarding and cross-training programs can easily support your portfolio companies at scale as they seek to grow their talent base, adding more team members if and when the need arises. This model of one-to-one resource allocation is especially well-suited to firms that are chasing big wins in the buy-and-build model of investing, allowing elasticity and scalability as the portfolio grows.

Get Your Reporting Back on Track – Private Equity Outsourcing Playbook

In outsourcing, teamwork is more than just a platitude. A BPO provider that puts a heavy focus on building a strong partnership will invest in the success of their clients by codifying key performance indicators (KPIs) that matter most directly into the initial service level agreement (SLA).

Deciding where you want to see improvements in efficiency and cost reduction will be important right at the onset. Be sure that your provider is flexible enough to create a unique solution from the first quarter to the last.

Moving the responsibility of reporting key metrics out of house can make for fewer struggles during transition and ensures on-time delivery as a matter of contractual agreement. You decide when you’ll be provided with updates on key metrics, and a universalized process means across-the-board consistency that translates into actionable insight once you receive those updates, allowing you to plan ahead no matter what trick play might come your way.

One provider means one deliverable. No matter the number of companies within your portfolio or the business units you’re managing within one organization, you can work with a provider who gives you the information you need in one package with no delay of game — on time, every time.

reporting back on track

Stop Fighting With Your Portfolio Company’s Technology

A major hurdle to streamlining accounting processes within new acquisitions is the disparate technology many investors inherit in the process. Managing multiple portfolio companies means you may be faced with an amalgam of enterprise resource planning (ERP) software to wrangle before the blitz of closing the books every month.

A tech-agnostic provider ensures a perfect play every time.

With one business unit using NetSuite or Sage, one using QuickBooks, and yet another still clinging to Excel for bookkeeping tasks, you can all but guarantee a reporting structure with too many men on the field: resulting in multiple entangled formats that slow month-end close and don’t give you what you need anyway (think major penalties in the long run).

This kind of disparity is unsustainable and will stand in the way of a profitable exit.

Tech-agnosticism is a term that refers to a vendor who can work within the confines of any ERP their client desires.

There are no expensive fees for the use of proprietary ERP software, and no lengthy migrations that leave client data at increased risk as the result of shoehorning it into a provider’s preferred tech stack.

Whether you want to streamline all your technologies or simply get the right reports from each one of your portfolio companies, a tech-agnostic provider ensures a perfect play every time.

Working with a tech-agnostic provider keeps your data safe, synchronizes reporting across the entire portfolio, and allows offshore talent to step directly into the financial department so investors can see results across the board—from efficiency to cost- savings — without having to run interference.

Implement the Same Process Across All Your Portfolio Companies – Start With Our Private Equity Outsourcing Playbook

Finally, investors should consider implementing the same model across every company in their firm’s portfolio. Working with a single, client-focused BPO partner allows for rapid implementation of efficiency-driven, tech- agnostic universalized processes, all with a team that’s precisely the right size.

PE firms can deploy strategy with precision, agility and speed to bring portfolios closer to maturity and meet the goals they’ve set for exit.

Because the foundations for cross-organization success are laid with the initial implementation, investors can avoid lengthy and costly re-implementation with different providers each time they make an acquisition.

This synchronizes perfectly with the speed at which private equity has to operate and gives firms a competitive edge in a crowded market, allowing them to play to win.

In an offshore, outsourced model, reputable providers don’t just take on the legwork that goes into streamlining the accounting processes of a portfolio company’s underperforming finance department. BPOs that function as a part of your team assume responsibility for hitting the KPIs that you set for your portfolio at the outset—and you can hold them accountable for the results.

The concept of adding offshore talent to your starting lineup is nothing new but creating a game plan that includes the right outsourcing partner for private equity firms is still one of the best-kept secrets in the industry. Finding a partner that has the technical flexibility, hard-working muscle and team-size agility to compete can provide you with the private equity playbook that delivers a winning track record again and again.

About Personiv

For nearly 40 years, Personiv has been an agile partner in the BPO field, creating custom solutions for organizations of all sizes across the globe. With an acute understanding of the needs of financial leadership across every sector, our white-glove service provides increased efficiency at a greater cost-savings no matter the industry.

Personiv can help investors put together a team of highly skilled professionals that act as an extension of stateside teams: from a team of one to a full accounting department, providing a suite of services that include:

• Accounts Payable • Vendor Inquiry • Accounts Receivable • Aging and Reconciliation • General Bookkeeping • Tax and Treasury Services • Balance Sheet Reporting • Month- and Year-end Closing • General Ledger Reporting • Payroll Setup • Expense Allocation • Invoicing • Check Imaging

Services that fit YOUR GAME PLAN

Contacting Personiv is the first step to implementing the crucial plays that will drive the results you need to win. If you’re ready to take your strategy to a higher level, we’re ready to hear how we can best support your strategy by leveraging the expertise we’ve built over the past three decades. Contact us now for a strong start!


Get full access to the private equity outsourcing playbook here

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