As private equity (PE) firms push to maximise value, the right leadership in their portfolio companies is critical. One of the most impactful hires - The CFO.

More than just a financial steward, a private equity CFO plays a pivotal role in executing the investment proposition, driving operational excellence, and ensuring the company scales effectively. That’s why PE firms are increasingly bringing CFOs in early in the investment cycle - to establish financial discipline, accelerate transformation, and position the business for a strong exit.

A Strategic & Operational Leader

The ideal PE CFO operates at the intersection of strategy and execution. They don’t just report the numbers; they shape the company’s trajectory. Beyond traditional finance responsibilities, they serve as a thought partner to the CEO, working across divisions to implement scalable systems, streamline processes, and drive performance improvements.

Big-Company Veteran or Agile Operator?

History suggests that a private equity CFO should have experience in an organisation at least as large and complex as the portfolio company’s projected future state. For example, if a PE-backed company aims to scale from £50m to £150m through international expansion, a CFO who has successfully managed a global scale-up enterprise is an obvious candidate.

However, scale alone isn’t enough - the right CFO must also be adaptable. A CFO coming from a large corporation with well-established infrastructure may struggle in a fast moving, resource constrained PE environment. In contrast, an executive who has thrived in both structured and entrepreneurial settings, perhaps by leading a division in an emerging market, may be better suited. The sweet spot is someone who knows “what good looks like” in a mature organisation but has the hands-on mindset required to build from the ground up.

Does Sector Expertise Really Make a Difference?

At first glance, hiring a CFO from the same industry seems like the safest choice. An industry veteran brings immediate credibility, an understanding of key performance metrics, and insights into the competitive landscape. In highly regulated sectors like financial services or healthcare, deep industry expertise can be essential.

But the best candidate isn’t always the one with the most industry-specific experience. Many PE firms prioritise finance leaders with strong operational backgrounds, even if they come from a different sector. A manufacturing company struggling with supply chain bottlenecks, for example, may benefit from a CFO who understands logistics and lean operations, even if they don’t have direct experience in consumer products.

What truly matters is whether the CFO has the right mix of skills to drive value in the current business environment. Those with experience in cost optimisation, M&A, global expansion, or ERP implementation may provide more value than someone with a narrow industry focus.

More Than Just a Finance Leader

Unlike the traditional reporting accountant, whose primary role is to ensure accurate financial reporting, a high-performing PE CFO is forward-looking. They view the business through the windshield, not the rearview mirror - constantly anticipating risks, identifying growth levers, and driving strategic initiatives.

In many cases, PE-backed CFOs take on responsibilities beyond finance. IT, legal, HR, supply chain, and real estate may all fall under their purview, making them a central figure in the company’s transformation journey.

They are also the key link between the portfolio company and its financial sponsor - aligning business strategy with investor expectations, navigating capital structure complexities, and ensuring the company is positioned for an optimal exit. Given the high stakes, private equity firms often play a major role in selecting the right CFO, even if the final decision rests with the portfolio company CEO.

Aligning the CFO Role and Investment Strategy

The ideal CFO profile depends on the investment strategy:

M&A-driven growth: If acquisitions are a core pillar of the value creation plan, a CFO with deep experience in due diligence, deal structuring, and post-merger integration is a must.
Operational turnaround: If the focus is on cost reduction and efficiency, a CFO skilled in lean operations, shared services implementation, and working capital optimisation will be essential.
IPO readiness: If the goal is an eventual public offering, a CFO with capital markets experience, public company reporting expertise, and investor relations skills will be a key asset.

The Key to Successful Execution: The Right Team

Even the most capable CFO cannot execute alone. Building a high-performing finance function is critical, yet challenging in a PE-backed company, where structures are evolving, and expectations are high.

The best CFOs assess talent quickly identifying high-potential employees and placing them in leadership roles where they can make an immediate impact. They also foster a culture of financial accountability across the organisation. When non-financial leaders understand how their decisions affect cash flow, profitability, and valuation, the entire company operates more efficiently.

Conclusion

There’s no single blueprint for the perfect private equity CFO. The right candidate balances strategic thinking with operational execution, brings a hands-on approach to problem-solving, and understands what’s needed to drive value at every stage of the investment lifecycle.

Above all, they think like an owner - aligning their decisions with the long-term success of both the business and its investors. By finding a CFO with the right mix of experience, adaptability, and leadership, PE firms can set their portfolio companies up for transformational growth and a successful exit.

If you would like to hear more about Pearse Professionals can help shape the future of your business, or you’re a PE investor and want to understand how we can introduce the right CFO to your portfolio company, please do not hesitate to get in touch – willdodds@pearseprofesssionals.com

Pearse Professionals is a specialist Senior Portfolio Finance recruitment company based in London, providing expert recruitment services to top finance firms across the UK and internationally.

We connect talented professionals with leading employers to help build successful, diverse teams in the finance industry. Contact us today to find out how we can help you advance your career or fill your senior finance roles with the best talent in the market.

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Beyond the Numbers: The CFO’s Role in Private Equity Success