Leading in a PE world
David Heron, chief executive officer of The Wilton & Bain Group
I am coming up to my 2nd birthday as the CEO of Wilton & Bain Group. Almost 24 months of leading the firm under our new board, and with private equity investment from our partner Beechbrook Capital. Often, when I ask candidates about their career aspirations, they say “to have some skin in the game. To lead a business with a private equity investor, through an event, and an exit”.
This is an interesting aspiration. According to Alix Partners, “73% of CEOs are replaced during an investment cycle and 58% are gone within two years. Half the time, when a new CEO is brought in, they are no longer standing after nine months”. Scary stuff, hence writing this before my 2nd birthday.
When I interviewed with Wilton & Bain in 2011, our illustrious chairman, and my now friend, Piers Marmion, gave me one line of advice that I will never forget. He told me to focus on building a business of consequence. At the time, I had no idea what he was talking about. I knew there was an opportunity to build a new type of firm. I knew that in Jeremy Mobbs, Ben Latreuille and Warwick Stacey, I had founding Partners around me who were so committed to the firm, and to our journey, that we would not fail to deliver. But what were we trying to deliver?
My reflections on our time pre-Beechbrook and post-Beechbrook are interesting. Unaware of it at the time, ‘founder’ businesses do have limitations. They are wonderfully quirky; emotive; fast and energetic, but they often lack cohesion, infrastructure & planning. The entire ethos of these firms is about the now, and the tactical needs of today, always get in the way of any strategic dreams for tomorrow. I’ve always been inspired by the world of sport and of the military. I admire the elite. Not because of their ability, but because of their mind set. I admire the best sporting teams for their togetherness & for their goal-oriented focus. There are always small steps, but the DNA of a great sporting team, is the legacy of passing down your shirt to the next generation. Empowering the future, and creating a sustainable environment. This is why teams like the All Blacks win, game on game, year on year, generation after generation. They understand the standards that are expected, and they may not win the always win the fight, but they will consistently win the war.
Post-Beechbrook, I’ve come to realise what Piers was saying to me. Becoming a great CEO and leader, is about other people. It is about creating the vision and platform to allow others to achieve their dreams. It is about listening, learning, and striving to create an environment and infrastructure where people can be the best they can be. It is about being decisive, but making the right decisions, in the right order. And actually, I think that is why 58% of CEOs are gone within two years of a PE investment. It is because they don’t have the vision, or belief system to stand up for what is right; to fight for building a better business; to fight against short term mindset and fight to lead the business with “consequence” at its heart. They basically get stuck into the doing, without due thought of the what or the why or critically the unintended consequences of moving with less speed, and more haste. If I have learnt nothing else, it is to be honest; to surprise no one, and to slow down to hurry up.
Wilton & Bain is far from a perfect company. We have lots to do; new offices in the United States and London; a new brand coming in the summer; a new organisational structure to launch, and new forces to navigate in our changing sector (none more so than politics!) but I have never been more convinced that we are building a business of consequence, and something that in years to come, people will remember as being significant.
Hopefully I will make it to my 2nd birthday; but either way, I know that we are creating more than another statistic.
Photo courtesy of Shutterstock.com