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  • Set clear targets

Set clear targets

Communication and collaboration issues often arise from a misalignment between expectations and goals. 

A core part of the analysis is keeping your targets realistic. Unrealistic plans for sales growth, cost cuts, and lack of foresight regarding future challenges can be a red flag for PE firms during a negotiation process that can create doubts about your management team’s business acumen. If unrealistic targets become the basis of setting future goals for your business during negotiations, they can lead to collaboration issues when they are missed. 

The same issues can affect communication and collaboration itself. Few company leaders and founders will have experience with setting targets and outlines for communication and collaboration, which in turn can hamper the efficiency of running your company, post-deal. 

Shaping the conversation and collaboration starts during the negotiation process, but it should be a continuous effort. Not everything will be put into the final contract, which could also stifle an open dialogue and both parties’ ability to optimise collaboration. Identifying how to maintain strong communication channels between you and your new collaborator should be a core focus in the days and week after a deal is reached. 

While the exact structure, form and regularity of communication between you and the PE firm will vary, there are guidelines which apply to almost any situation, including:

  • Be proactive instead of reactive: Communicate ahead of making important business decisions, including when unforeseen challenges arise. Be clear about what the problem is and how you are planning to remedy it. 
  • Define the decision-making process: Establish clear guidelines for what business decisions are the remit of your company and which decisions ought to be discussed with the PE firm before making a final call.
  • Ask for help when you need it: PE firms can offer valuable insight and assistance. Inform them of business issues and ask for guidance or a second opinion. 
  • Set and update communication schedules: Agree on a format and timetable for communication that keeps your collaborator continually updated without hindering the efficient day-to-day running of your business.
  • Avoid surprises. There are various ways of avoiding frustrations arising from a PE firm feeling like you are ‘springing’ new information on them. For example, it is a good idea to arrange a call with representatives of the PE firm a couple of days ahead of board meetings to lay out what you hope to discuss during the meeting.