Ethan Khatri

Why Platform Readiness Matters Before Buy-and-Build Begins Buy-and-build, the strategy of acquiring one company as a base and then bolting smaller businesses onto it, can make a growth plan look more compelling. It can also expose weaknesses that were manageable when the company was smaller. A platform, the base company that does the acquiring, should not begin consolidating simply because add-on opportunities are available. The first test is whether the business can absorb complexity...

Patient capital is often described as an advantage. In private markets, that can be true. Longer ownership can give investors and management teams the time to build better companies, avoid forced decisions, and pursue value creation with more discipline than a short exit timetable might allow. But patience is not a strategy on its own. Our view is that patient capital only becomes valuable when it is matched with an operating system: clear information, disciplined cadence, active...

Exit readiness is often treated as a late-stage workstream. In the current private equity environment, that is too narrow a view. Bain & Company reported that distributions as a percentage of net asset value have remained below 15% for four consecutive years, an industry record. The same report noted that the private equity industry is holding 32,000 unsold companies worth $3.8 trillion, with average holding periods at exit around seven years. Our view is that exit readiness now needs to...