According to McKinsey’s Global Private Markets Report 2025, distributions to limited partners (LPs) officially surpassed capital contributions for the first time in nearly a decade, with capital calls at 14% less than distributions—a dramatic shift after being 23% over distributions in 2023. After multiple years of trending downward, 2024 also saw a bump in dealmaking, with 14% YOY growth in deal value. Exits also picked up, with 8% more deals annually.
To be fair, PitchBook pumped the brakes on unbridled positivity in a couple of key areas after Q1, such as reversing its position on stronger exit opportunities and challenging capital deployment in 2025. Nevertheless, overall, the PE market appears to be picking up again, and the forward momentum is welcome. However, this creates a new challenge for general partners: Who should lead these new portfolio companies?
Between shifting consumer expectations, flexing political administrations, and global unrest stemming from a variety of factors, PE firms must lean on strong leadership and effective C-suite talent acquisition strategies to ensure that their holding company assets can optimize performance and create sustainable success, even in an unpredictable economic environment.
In this paper, we’ll briefly look at the state of the PE sector heading into 2025 and consider different talent acquisition, retention, and development strategies that can accelerate and accentuate portfolio company performance. We’ll also evaluate the role and benefits of a trusted partnership with a private equity-focused executive search partner in the process of leadership staffing in a portfolio company context.
As the private equity sector roars back to life, there are several areas that are emerging as focal points for change. Things like tighter SEC scrutiny, ESG initiatives, and sector specialization are in the spotlight as PE firms set up focused funding and seek greater investor appeal through deeper expertise and longer exit plans.
The middle market has also been soaking up the limelight. PitchBook’s 2024 Annual US PE Middle Market Report found the middle market accounted for 60% of all buyout activity in the PE sector. This accounted for $374.1 billion worth of deals in 2024 alone — the second-highest level on record.
Unsurprisingly, AI is also having an impact. Firms are using LLM models and deep learning to forecast trends and create predictive insights. BlueFlameAI adds that PE firms are using AI to automate outreach, streamline due diligence, and even accelerate evaluation, compliance, risk, and other related assessment elements for portfolio companies.
All of these changes, good and bad, point back to the need for competent leadership. In the midst of the change, PE talent market trends are shifting, and the need for quality executives remains acute. In fact, it’s intensifying.
Firms are seeing the truth behind the concept that talent acquisition is more than a functional element of acquiring a portfolio company. High-performing teams, especially at the executive level, are essential for rapid turnarounds, aggressive scaling, and sustained value creation.
This means the competition for experienced executives is accelerating in key areas, like fintech, AI, healthcare, and cybersecurity. This is leading to longer hiring cycles ending with higher compensation packages and an increasing concern about talent retention. Heightened investor expectations are further exacerbating this talent acquisition pressure as general partners have a narrowing margin for error when making key leadership hires.
This top-down pressure has made assembling the right leadership team in portfolio management and operations a top priority for PE firms looking to adapt to market conditions and make the most of each acquisition in the promising months and years ahead. The question is, who should you hire and when should you hire them?
One of the most important factors in building a competent and experienced leadership team in a private equity context is understanding the positions that matter most. A CEO, Chief Revenue Officer, or Chief Financial Officer in a PE-backed firm is quite often cut from a different cloth compared to their non-PE peers.
Prime candidates have exceptional talent. That goes without saying. However, they should also have deep knowledge and intimate experience with the private equity portfolio life cycle. They should possess a unique set of technical understanding, soft skills, and leadership traits. Industry-specific knowledge is also becoming a key indicator as PE firms invest heavily in niche companies in targeted industries.
As for the kind of roles required, the private equity C-suite is diversifying and expanding. Operational leadership is particularly important as general partners seek to staff portfolio companies with the leadership required to properly pilot portfolio companies through complex transitions, scaling initiatives, and healthy exits. Longer holding periods and delayed exits are also putting more attention on scalable growth over quicker wins.
Let’s look at some of the most important positions where it is worth investing significant recruitment resources.
The Chief Executive Officer remains a cornerstone of portfolio company success. A successful private equity CEO search seeks visionary individuals who can take action to drive growth. They are exceptionally capable of embracing change, building high-impact teams, and aligning branded goals with private equity goals.
Unique traits of a private equity CEO: A private equity CEO is different from the average CEO in that, whereas many traditional CEOs rise internally, PE CEOs are typically external hires. Rather than focus on long-term shareholder value (which is typical in other situations), they should have skill set that balances industry expertise, profitable growth, and fast results.
Financial leadership, especially CFO recruitment in PE, can make or break an investment. The Chief Finance Officer in a private equity environment is tasked with critical responsibilities, like aligning financial strategy with a PE’s investment thesis, driving operational efficiency, and preparing for successful exits.
Unique traits of a private equity CFO: Traditionally, CFOs focus on things like quarterly reporting and regulatory compliance. In the private equity model, a CFO’s priorities shift. They must be exceptionally good at managing things like leverage and liquidity and be well-versed in debt structuring, cost management, and other profitability-related initiatives. We’ve found the CFO position to be one of the most quiet yet critical pieces to a successful PE acquisition, optimization, and exit strategy.
A Chief Revenue Officer is particularly relevant for those focused on aggressive growth, scaling revenue, and maximizing enterprise value before an exit. It is also critical that you make the hire with an eye toward a CRO’s experiential talents. Are they equipped to manage an exit, or have they established themselves in other stages of growth, such as a startup? One CRO I regularly speak to goes from one PE-backed firm to the next. This specialization makes them a highly sought-after candidate with exceptional expertise and a clear track record in helping PE-backed firms make profitable exits.
Unique traits of a private equity CRO: A CRO in a PE-backed firm must be able to architect a scalable revenue engine that matches aggressive growth targets. They must also be ready to operate under intense pressure, generate immediate results, and engage regularly with private equity board oversight.
A Chief Operating Officer has a critical role in helping drive operations efficiency. This is critical in many acquisitions, especially if a turnaround is required. Over time, a COO can establish and oversee high-impact scaling and ensure ongoing alignment with aggressive growth goals.
Unique traits of a private equity COO: A PE-backed COO is a boots-on-the-ground position. They are more hands-on and often spend significant time focused on immediate operational improvements.
Technology is an integral part of all business. This makes a Chief Technology Officer essential, regardless of whether an acquisition is in the tech space or not. CTOs (also called Chief Digitial Officers or CDOs) design and implement digital transformation initiatives that can be drivers of efficiency, automation, and growth.
Unique traits of a private equity CTO: While CTOs often invest in innovation and creative planning, in a private equity context, there is a heavy emphasis on execution. This comes with the ability to align with clear ROI expectations over specific timelines.
As you work with an executive recruitment partner to fill these executive talent gaps, it’s important to maintain a streamlined and incisive PE leadership assessment process. Focus on important areas, including:
The private equity sector is coming out of the murky malaise of the past two years, and there are signs that it could become quite active again. It’s important for Deal Leads and GPs to have a strong executive search strategy in place as they prepare to acquire, manage, and divest portfolio companies at an accelerated pace in the coming months and years.
Working with a reputable executive recruitment partner like Stanton Chase gives you the flexibility to maintain a lean PE operation while enjoying industry-leading recruitment support and access to a robust talent network.
It is important to be proactive in building these recruitment relationships. Even if you aren’t actively seeking executive talent for a portfolio company, start the process of building a trusted relationship now. That way, whether you need help assessing, recruiting, coaching, retaining, or anything else, you will already have a partner in place to help you establish top-down optimization of every brand you acquire.
Sarah Shamouelian is a Director at Stanton Chase Los Angeles, specializing in executive recruitment across Financial Services, Private Equity, Technology, and Professional Services. With an MBA from Alliance Manchester Business School and 15 years of prior experience in Head of Sales and Business Consultant roles, Sarah brings a strategic global perspective to talent acquisition, having worked throughout the US, Europe, LATAM, and MEA. She is passionate about helping clients transform their organizations through optimized C-suite and senior leadership talent acquisition that combines quality with speed of execution.
Peter Deragon is a Managing Director at Stanton Chase Los Angeles, the Supply Chain Global Functional Leader, and the Capital Markets and Investment Banking Global Subsector Leader. He is also active in the CFO Practice Group and Financial Services, where he started his career. He has 30-plus years of experience as a trusted advisor and manager in B2B environments. In his free time, Peter supports charitable organizations, especially those focused on ocean stewardship.
At Stanton Chase, we're more than just an executive search and leadership consulting firm. We're your partner in leadership.
Our approach is different. We believe in customized and personal executive search, executive assessment, board services, succession planning, and leadership onboarding support.
We believe in your potential to achieve greatness and we'll do everything we can to help you get there.
View All Services