A well-structured program of coaching helps portfolio company leadership grow in competence, confidence and vision – thereby enhancing the rewards flowing to the company's investors. Read more below...
Venture capital and private equity investors spend significant time evaluating investment opportunities, developing strategies for portfolio companies, and pursuing attractive exits. In the midst of this intensive activity, investment enhancement through executive coaching may not be top of mind. But the investment value of coaching portfolio company leaders may be significant.
In many situations, a key driver for the success of the portfolio company is the leadership and other human capital of the company. In those situations, in order to maximize the potential of the company, it is wise – if not essential – to budget a reasonable expenditure on coaching for the CEO (and perhaps for the executive team individually or collectively). A well-structured program of coaching can help the portfolio company leadership grow in competence, confidence and vision – thereby enhancing the rewards flowing to the investors.
While investors’ board members can be quite helpful in monitoring and mentoring for leadership effectiveness, service on the boards of multiple portfolio companies may (as a practical matter) limit the members’ bandwidth to engage in those activities. Regularized coaching by those with the requisite training can provide greater assurance of optimal executive performance.