Getting ahead of the pack to win the right deals at the right price, to attract talented staff and to secure more funds, are challenges faced by all private equity (PE) firms. Competition from venture capital, angel investors, banks, alternative lenders as well as other existing and new PE players is fierce. To be successful, PE firms must ensure they are top of the pack on all three aspects; the good news is that a firm’s brand can help with all of these challenges.
We have scored and ranked the brand strength of a broad cross-section of UK based mid-market private equity firms typically investing anywhere up to £50M within Europe. Using our brand expertise, we have analysed the data – making reasonable assumptions – to draw insights about brand strength across the PE sector as a whole in our Benchmark in Private Equity report.
Only 10% of firms have a strong brand
We found that only 10% of PE firms met our brand strength benchmark, meaning there is an undeniable opportunity for firms willing to invest in their brand to get ahead of their competitors.
Since we started our research in summer 2018, 10% of the firms we looked at have refreshed their brand and launched a new website. Firms who do not take any actions to improve their lacklustre brand are at risk of being left behind by their competitors and losing out on valuable deals, funds and staff.
But how does a strong brand make a difference?
Boosts business development work
Successful brands are built on a solid base of understanding about their positioning within the sector and their value proposition to audiences they want to work with. This clarity of understanding enables brands to sharpen their sales approach with clear communication, narrowing the sales funnel and loading it with quality leads that are ripe for converting.
Helps to close the right deals at the right price
A strong brand will positively resonate with target audiences, self-selecting the people the firm wants to do business with. These leads will naturally have an affinity to the brand and through a sharpened sales approach will understand the value you can bring to their business beyond those that are common across all PE firms. This positions your firm as highly desirable, putting you in a better position of power during deal negotiations.
Positions you top of mind for proprietary deals
Businesses looking for funding are spoilt for choice, so PE firms need to cultivate a range of tactics to source deals. A strong brand positions a firm top of mind amongst stakeholders and contacts, with a strong reputation as the firm of choice within your area of expertise. This will open more opportunities for you to hear about deals before the rest of the market, giving you a competitive advantage.
Our Benchmark in PE research has highlighted that too many PE firms have a lacklustre brand, and that they need to invest both time and money to improve their brand strength now. Failure to take any action will mean they risk being left behind by their competitors and losing out on future opportunities.
To find out where PE firms ranked, why brand strength is important and how to improve your brand strength, read our report here.