High CEO Turnover in Private Equity: Why It Happens and How Coaching Can Help
CEO turnover in private equity (PE)-backed companies is high. A study by AlixPartners found that 58% of PE-backed CEOs are replaced within two years, rising to 73% over the full investment cycle (AlixPartners Report). While sometimes strategic, frequent leadership changes create instability, delay value creation, and impact investment returns.
Why Do PE CEOs Struggle?
Performance Pressure – PE firms expect rapid business transformation and financial growth; failure to deliver leads to replacement.
Strategic Misalignment – Conflicts arise when CEOs and PE sponsors have different growth strategies and expectations.
Cultural Fit Issues – Some CEOs struggle with PE’s fast-paced, high-stakes environment.
Investor & Board Management – Navigating private equity board dynamics and scrutiny is critical.
How Coaching Reduces CEO Turnover
At Portobello Advisory, we’ve been PE professionals, board members, and executive coaches. Our unique perspective helps CEOs in PE-backed companies:
Manage Investor Expectations – Improve board relationships, stakeholder engagement, and strategic communication.
Strengthen Financial Acumen – Enhance financial literacy, investment analysis, and operational efficiency.
Lead Under Pressure – Build resilience, adaptability, and high-performance leadership in demanding PE environments.
A Smarter Approach to CEO Success
Instead of replacing CEOs, private equity firms should invest in their leadership development. The cost of CEO turnover—including lost momentum, extended holding periods, and recruitment expenses—far outweighs the benefits of executive coaching.
If you're a PE firm or CEO looking to thrive in a PE-backed environment, let’s talk. Executive coaching is a strategic tool for maximizing leadership effectiveness and portfolio company success.
