When it comes to building high-performing companies, both private equity (PE) and venture capital (VC) investors know that talent is the ultimate differentiator. Yet, many firms still take a reactive approach to hiring—waiting until a leadership gap appears before scrambling to fill it.
This mindset is a missed opportunity. The best firms treat portfolio hiring as a strategic advantage, embedding talent strategy into their investment decisions from day one. Whether scaling a VC-backed start-up or optimising a PE-backed business post-acquisition, a proactive, structured approach to hiring is what separates high-performing funds from the rest.
Different Investment Models, Same Talent Challenges
At first glance, PE and VC firms seem to operate in different worlds. VCs invest in high-growth start-ups, often run by founder-led teams who need to transition into a more structured leadership model. PE firms, on the other hand, acquire more mature businesses, focusing on profitability, operational efficiency, and leadership upgrades.
But despite these differences, both models rely on one key driver of value: the right leadership team at the right time.
For VC firms, the challenge is helping founders transition from scrappy operators to leaders who can scale an organisation. This means hiring growth-stage executives (a seasoned COO, a strategic CFO, or a VP of Sales) before the company hits a breaking point.
For PE firms, the focus is on optimising leadership teams post-acquisition—often replacing or supplementing existing management with experienced operators who can drive EBITDA growth and prepare for an exit.
In both cases, waiting too long to fill these gaps leads to lost momentum, operational inefficiencies, and lower valuations.
Beyond the Job Description: The Bigger Picture in Portfolio Hiring
One of the biggest mistakes I see firms make is hiring based on a checklist instead of a holistic strategy. I’ve worked on countless executive searches where, on paper, a candidate might tick all the boxes—but they weren’t the right fit for that specific company, leadership team, and stage of growth.
The best approach is always to look at the bigger picture. It’s not just about hiring a star player—it’s about building the right team. That means considering:
How will this hire complement the existing leadership team?
Does this person bring the right mix of strategic vision and execution ability?
Are they the right cultural fit for the company and its investors?
These nuances don’t show up on a CV. They require deep collaboration with the internal team, the investors, and a hiring partner who understands not just what looks good on paper, but what actually drives success in a portfolio company.
How Top PE & VC Firms Win with Talent
Too many firms rely on personal networks and last-minute searches when filling executive roles in their portfolio companies. This approach is outdated and risky. Instead, leading PE and VC firms are adopting a structured, data-driven approach to portfolio hiring that gives them a competitive edge.
Here’s how:
Integrating Talent Strategy into Due Diligence
PE firms assess financials and operations pre-acquisition—why not leadership too?
Understanding the strengths and weaknesses of the existing team before the deal closes allows firms to plan immediate leadership upgrades post-close.
VCs can assess whether founders have the skill set to scale or if they will need an experienced COO or CFO within 12–18 months.
Building a Pre-Vetted Talent Bench
Instead of waiting for a crisis, top firms map talent ahead of time, identifying candidates for CEO, CFO, COO, and CPO roles before portfolio companies need them.
Having a pre-vetted shortlist means faster placements, less disruption, and stronger post-investment execution.
Partnering with Specialised Portfolio Hiring Experts
This is where firms like Armstrong International come in. Instead of taking a transactional approach to executive search, Armstrong works holistically across entire portfolios, helping PE and VC firms build custom talent strategies that align with their investment thesis.
We don’t just look at CVs—we work in partnership with internal teams, understanding the business, leadership dynamics, and future goals to find the best talent for the situation, not just the best on paper.
Embedding Talent Strategy into Portfolio Support
Firms that actively support their portfolio companies with hiring resources—rather than leaving it up to founders or management—see better long-term performance.
Offering structured talent development, leadership coaching, and succession planning increases retention and stability across the portfolio.
How Armstrong International Helps PE & VC Firms Gain a Competitive Edge
My most successful hires have always happened when:
We’ve ensured a talent roadmap that aligns with the value creation plan.
We’ve thoroughly mapped and built strong pipelines (proactively and ad-hoc) and not just a curated shortlist.
We’ve worked as a true partner, not just a search firm, by going beyond the job description.
We’ve used data to give us market insights and challenged the process if it wasn’t working, ensuring both client and candidate experience—because it always takes two to tango.
The Bottom Line: Hiring is a Value Creation Strategy
Whether in VC or PE, winning firms understand that hiring is not just an HR function—it’s a core value creation strategy. The best investors don’t just fund great companies; they build the leadership teams that turn them into success stories.
