In PE-backed businesses, time is capital. And, as the clocks ticks on every investment cycle, it’s your role as CFO to deliver transformation, scale and ultimately, a premium exit.
It’s also an opportunity to lead from the front – shaping strategy, driving operational excellence, and building a business that almost sells itself.
That’s why we created this playbook. It’s a guide for CFOs of PE-backed businesses navigating the unique pressures of your position, designed to help you move the dial on exit strategy business planning, exit valuation and multiples.
VALUE CREATION UNDER THE CLOCK
From day one, CFOs of PE-backed businesses are balancing short-term performance with long-term exit planning. That means building a finance function that’s proactive, not just reactive – one that can model scenarios, surface insights and support bold decisions.
The best CFOs understand the investment thesis, align the business plan to the exit horizon, and keep everyone focused on the metrics that matter – shaping a story that will result in a successful exit.
While investors often demand immediate EBITDA improvements and cash flow discipline, the ultimate goal is a premium exit multiple. CFOs must therefore design strategies that deliver operational wins today without compromising scalability, compliance, or tax efficiency tomorrow.
This means prioritising investments in systems, talent, and governance that enhance reporting accuracy and resilience, while structuring incentives to keep management focused on sustainable growth. By aligning near-term KPIs with exit-readiness metrics – such as working capital optimisation, tax-efficient structuring, and clean audit trails – CFOs can create a narrative of predictable performance and strategic foresight that maximises valuation at exit.
OPERATIONAL EFFICIENCY: HOW TO GROW YOUR MARGIN
Operational efficiency is an effective way to grow your margin. Successful CFOs drive operational efficiency over their time in the role, growing margin and achieving more valuable exits.
Amongst the initial priorities will be Finance Transformation – can we begin to automate processes such as Payables and Receivables? Do we need to think about an ERP upgrade? The Finance function needs to be ready to scale and should be fit for purpose beyond exit.
Excellent Financial Reporting will be the base for what the team does. Ensure that this is fast and accurate. Once this is in place and embedded in the business, focus can shift to commercial analysis and forecasting.
Cost Management is a non-negotiable. Implement zero based budgeting to strip back unnecessary spend and build a culture where return on investment is considered alongside significant spending decision. Ensure that adequate controls are embedded into the process.
Once these areas are covered – areas such as pricing analysis, procurement policy and financing options can be considered to ensure that the business is optimizing for stronger margins.
Finally, in the lead up to exit, there needs to be discipline around forecasting and reporting, data-room quality information should be standard. This will facilitate a smoother process and avoid unnecessary stress around the exit.
M&A INTEGRATION: BOLT-ONS TO BOTTOM-LINE GROWTH
Buy and build is a favoured PE strategy, with a large proportion of UK mid-market deals being driven by consolidation plays. It’s a journey we’ve been living through at CP with 16 deals in the past two years – but integration is where value is won or lost.
CFOs of PE-backed businesses have to ensure every acquisition is aligned and scalable. That means rigorous finance, tax and legal due diligence, clear integration plans and a laser focus on cultural fit. And, above all, a clear strategy on how each acquisition will create value – whether that’s synergies, expanding into new territory, or know-how and tech that will help you scale.
At CP, our former CFO, James Parnell now oversees M&A and integration as Chief Acquisitions Officer, making sure any potential deals fit just right – on all fronts.
You can hear from James on what he’s learnt from the process here, and if you’re looking to work with advisers to drive forward your deal, head over to our Transaction Services page.
DEBT STRATEGY & COVENANT MANAGEMENT
Utilising debt facilities in a PE-backed business can be a powerful tool to maximising returns throughout the investment cycle.
This can be funding working capital and capex in high growth businesses with an organic strategy or funding bolt-on acquisitions for buy and build platforms. The alternatives of funding growth through cash generation can mean the pace can be too slow and raising further equity from PE can reduce their potential returns and dilute other shareholders too much.
Using debt can accelerate the pace of growth without diluting the equity. The key is to structure the debt facilities appropriately, to provide the balance of access to funding without creating obstacles for the business, such as controls being too tight.
A CFO will need to be adept with how facilities, controls (such as financial covenants and restrictions on cash usage) and pricing works, as well as what is considered to be competitive. An adviser can help with navigating the complexity of a debt deal, making sure the debt achieves the desired effect of funding growth.
If you have any questions about your debt strategy, get in touch with CP’s Debt Advisory team today.
TAX STRUCTURING & INCENTIVE SCHEMES
Tax strategies are essential in any business, particularly if you’re PE-backed. From group structuring to related-party financing, CFOs must navigate a constantly evolving and high-governance landscape, balancing efficiency whilst managing tax risk with an eye on exit.
Tax is central to value creation during the hold period. Decisions on management incentive arrangements, intra-group trading, international expansion, IP ownership, debt financing and capex all influence EBITDA and cash flow. For a CFO, maintaining a proactive lens not only mitigates risk but also unlocks opportunities – maximising post-tax returns for shareholders, reducing volatility and ensuring the business is fully exit-ready when the time comes.
Find out how we support PE-backed businesses at CP across the whole Tax spectrum here.
EXIT READINESS
The best CFOs start preparing for an exit early, building audit-ready processes, clean data rooms and a compelling equity story. It’s diligence-ready, and it ensures quality of earnings are robust and defensible, with issues around tax and other exposures properly managed.
Buyers want confidence. That means ESG maturity, cybersecurity resilience and a finance and tax function that can stand up to diligence.
It also means making sure that quality of earnings is robust and can be supported in the diligence process with any exposures or issues properly thought out and managed.
We shared a detailed article on this topic earlier this year off the back of our webinar with Nick Lally, Founder & CFO of Ravelin Technology: Exit Readiness: 7 Top Tips From The Frontline.
WHY THE RIGHT ADVISORY TEAM IS A MULTIPLIER
The right advisory partner understands the PE-backed playbook, speaks your language, shares your journey and brings insight that drives measurable value.
At Cooper Parry, we work closely with a large number of CFOs in PE-backed businesses. From fast-growth, mid-market firms with £10m+ turnover, all the way up to £1bn turnover businesses, we can help you accelerate value creation and build robust organisations that are ready to exit.
So, if you’d like to chat and have us assess your value creation roadmap and exit readiness, don’t hesitate to get in touch.
