Human capital continues to be PE's largest focus area. Firms are moving quickly towards specialized experts and resources to stand out from peers.
NASHVILLE, Tenn. , April 19, 2022 /PRNewswire-PRWeb/ --
BluWave, a private equity-focused B2B Intelligent Marketplace, today released the latest quarterly PE report revealing Q1 2022 industry trends and predictions concentrated on value creation and due diligence. BluWave data reveals historic highs in value creation activity after a robust Q4 2021 acquisition period. Human resources continues to lead all functional activity and is still the PE industry's largest area of focus. PE firms are also keeping an emphasis on specialized, rather than generalist, capabilities in both human capital and service providers.
BluWave founder and CEO Sean Mooney observes that people are a PE firm's wisest investment. "The best business builders in the private equity industry are continuing to accelerate their investment in people. The notion that you can either get strategy right or people right has been debunked by PE. Our data shows 'people who can execute on strategy' is the PE firm's priority investment," said Mooney.
Key findings from the BluWave Q1 2022 Insights Report:
- Value creation accounted for 78% of all PE activity, a record high for the industry and up 8% vs Q1 2021. This is due to the robust number of deals made in the second half of 2021. PE firms are hitting the ground running on value creation initiatives for new investments.
- Of all value creation activity, human capital accounted for nearly half of all Q1 initiatives, up 14% vs Q1 2021. Interim executives and specialized recruiters are among the fastest growing needs as PE firms look to differentiate by leveraging senior advisors with deep track records.
- Strategy activity led due diligence as PE firms leveraged specialized diligence providers to confirm investment theses and build differential growth strategies. IT and cyber diligence also increased in importance, with PE firms seeking out specialized groups and moving away from larger generalist providers.
- As inflationary pressures continue to mount, BluWave sees PE firms taking swift action to navigate input cost increases, defend against suppliers increasing prices to portfolio companies, hone operations, and focus on organizational effectiveness, compensation strategies, and talent recruitment and retention.
BluWave Managing Director Katie Marchetti added "At the beginning of 2018, HR was below 20% in the BluWave Activity Index and now for the seventh straight quarter it's trended above 35%, with the hottest position to fill in PE being Head of Human Capital. We see our data as a normalized distribution of what's happening in the private equity industry and that data is telling us that PE firms continue to focus on what's core, including bringing in amazing talent to their portfolio companies."
To request a copy of the full report, please visit https://bit.ly/3JZoNyp.
About BluWave
BluWave is an innovative B2B Intelligent Marketplace that uses technology, data, and human ingenuity to connect more than 500 leading private equity firms and thousands of proactive businesses with best-in-class, pre-vetted, third parties for critical due diligence, value creation, and preparing for sale needs. BluWave's invitation-only Intelligent Marketplace includes private equity-grade service provider groups, independent consultants, and interim executives. Visit http://www.BluWave.net for more information.
Media Contact
Gregory Papajohn, Archie Group, 1 917.287.3626, [email protected]
SOURCE BluWave
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