OneGuide ads

When we analyzed 40+ top growth equity firms, we found that on average they spend 𝟵 𝗯𝗽𝘀 𝗼𝗳 𝗔𝗨𝗠 𝗼𝗻 𝗽𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗼𝗽𝘀 𝘁𝗲𝗮𝗺 𝗰𝗮𝘀𝗵 𝗰𝗼𝗺𝗽 (so about $1M in ops team comp for every $1B in AUM). Bigger firms spend more, but it's not perfectly linear. Firms with <$2B AUM spend an average of 𝟭𝟮 𝗯𝗽𝘀, while firms with >$25B spend an average of 𝟮 𝗯𝗽𝘀. That make sense, because there are some costs that don't scale perfectly with number of portfolio companies, especially if you're running a Centers of Excellence or Full Stack team (see our full report for more cuts by team team). But it means that it's EXPENSIVE for smaller firms to put forward robust portfolio operations teams. So the question becomes: what can you do to support value creation other than staffing more portfolio ops FTEs. We're seeing firms do two things: 1) 𝗨𝘀𝗲 𝘁𝗲𝗰𝗵𝗻𝗼𝗹𝗼𝗴𝘆 𝘁𝗼 𝗹𝗲𝘃𝗲𝗿 𝘂𝗽 𝘁𝗵𝗼𝘀𝗲 𝗼𝗽𝘀 𝗙𝗧𝗘𝘀, sharing resources in more one-to-many and self-serve ways 2) 𝗔𝘂𝗴𝗺𝗲𝗻𝘁 𝘆𝗼𝘂𝗿 𝗙𝗧𝗘𝘀 𝘄𝗶𝘁𝗵 𝗮 𝗻𝗲𝘁𝘄𝗼𝗿𝗸 𝗼𝗳 𝗻𝗼𝗻-𝗙𝗧𝗘𝘀, including exclusive advisors, vetted consultants, and trusted vendors. OneGuide helps with both :). Visit askoneguide.com to get a full copy of our annual report and/or a demo of how we help.

We divide portfolio ops strategies into 4 main buckets, and the biggest challenges/opportunities vary by strategy. 𝗟𝗶𝗴𝗵𝘁 𝗢𝗽𝘀: 𝟭-𝟮 𝗢𝗽𝘀 𝗙𝗧𝗘𝘀, 𝘂𝘀𝘂𝗮𝗹𝗹𝘆 𝗴𝗲𝗻𝗲𝗿𝗮𝗹𝗶𝘀𝘁𝘀 𝗼𝗿 𝘁𝗮𝗹𝗲𝗻𝘁 𝗹𝗲𝗮𝗱𝗲𝗿𝘀. Lowest cost, but you have to "pick your spots" on what the ops team does. Can be a strong fit at newer/smaller funds where investing partners don't have too many portcos and are deeply involved in value creation. 𝗠𝗼𝘀𝘁 𝗶𝗺𝗽𝗮𝗰𝘁𝗳𝘂𝗹 𝗺𝗼𝘃𝗲: Scale reach, so that 1-2 people can serve a full portfolio Top tactics: ✓ Host 1:many events ✓ Tap resources beyond the firm (vetted consultants) ✓ Enable investors _____ 𝗚𝗲𝗻𝗲𝗿𝗮𝗹𝗶𝘀𝘁 𝗢𝗽𝘀: 𝟯-𝟭𝟭 𝗙𝗧𝗘𝘀, 𝘂𝘀𝘂𝗮𝗹𝗹𝘆 𝗲𝘅-𝗰𝗼𝗻𝘀𝘂𝗹𝘁𝗮𝗻𝘁𝘀 𝗼𝗿 𝗲𝘅-𝗖𝗘𝗢𝘀 Great if you want to have a strong generalist own the relationship with a fixed number of portfolio companies, usually 2-4. But by definition, these people aren't specialists. 𝗠𝗼𝘀𝘁 𝗶𝗺𝗽𝗮𝗰𝘁𝗳𝘂𝗹 𝗺𝗼𝘃𝗲: Become a "router" so that generalists can meet tactical needs Top tactics: ✓ Align within the firm on go-to value creation levers ✓ Curate experts for specific project types _____ 𝗖𝗲𝗻𝘁𝗲𝗿𝘀 𝗼𝗳 𝗘𝘅𝗰𝗲𝗹𝗹𝗲𝗻𝗰𝗲 𝗢𝗽𝘀 : 𝟯-𝟭𝟭 𝗙𝗧𝗘𝘀, 𝘂𝘀𝘂𝗮𝗹𝗹𝘆 𝗲𝘅-𝗖𝗧𝗢, 𝗖𝗥𝗢𝘀, 𝗖𝗙𝗢𝘀 𝗲𝘁𝗰. Good for firms with a tight investment scorecard (relatively homogenous portfolio) where a senior CXO can be a valuable advisor or even interim exec. But, "too many cooks in the kitchen" can come into play if you have 5 CoEs all trying to run projects with the same portco at the same time. 𝗠𝗼𝘀𝘁 𝗶𝗺𝗽𝗮𝗰𝘁𝗳𝘂𝗹 𝗺𝗼𝘃𝗲: Create a shared nexus between the different centers of excellence Top tactics: ✓ Establish shared practices across CoEs ✓ Document CoE leader know-how ✓ Bring functional peers together _____ 𝗙𝘂𝗹𝗹 𝗦𝘁𝗮𝗰𝗸 𝗢𝗽𝘀: 𝟭𝟮-𝟭𝟬𝟬+ 𝗙𝗧𝗘𝘀, 𝘂𝘀𝘂𝗮𝗹𝗹𝘆 𝗮 𝗺𝗶𝘅 𝗼𝗳 𝗴𝗲𝗻𝗲𝗿𝗮𝗹𝗶𝘀𝘁𝘀 𝗮𝗻𝗱 𝘀𝗽𝗲𝗰𝗶𝗮𝗹𝗶𝘀𝘁𝘀 Offers the most control and repeatability, and enables firms to offer pooled services at below-market rates if the firm also staffs more junior "doers" to the ops team (e.g. executive recruiting, pricing consulting, and increasingly, AI enablement). But, big teams are $$$. 𝗠𝗼𝘀𝘁 𝗶𝗺𝗽𝗮𝗰𝘁𝗳𝘂𝗹 𝗺𝗼𝘃𝗲: Build a source of truth to drive utilization of ALL the resources the firm brings to bear. Top tactics: ✓ Document offerings (resources, experts, projects, etc.) ✓ Self-serve options ✓ Track usage & results OneGuide supports firms of all 4 types (in slightly different ways). Check out our website to learn more.

In 2025, portfolio ops has become table stakes (97% of top firms in our annual report have at least one FTE), but 10 years ago it was MUCH less common, and 20 years ago it was a new idea. In 3,000 characters or less, here’s a brief history of portfolio ops… 𝟭𝘀𝘁 & 𝟮𝗻𝗱 𝘄𝗮𝘃𝗲𝘀 𝗼𝗳 𝗣𝗘: 𝗕𝗲𝗳𝗼𝗿𝗲 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗢𝗽𝘀 - conventional wisdom seems to be that modern private equity was invented after WWII when some of the first American Venture Capital firms were founded. The next big inflection point came in the 1980s, the leveraged buyout era, when PE boomed. In the 20th century, there was limited focus on value creation (with some possible exceptions, e.g. Bain Capital founded in 1984 has had some ops in its DNA from the beginning). 𝗧𝗵𝗲 𝗔𝗿𝗿𝗶𝘃𝗮𝗹 𝗼𝗳 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗢𝗽𝘀 - as investing became more crowded and competitive, firms began thinking more deeply about boosting returns by accelerating value creation. They initially landed on the concept of staffing internal consulting teams rather than paying $$$ to McKinsey, BCG, or Bain. From 2000-2005, some big name (and big AUM) firms launched their consulting arms: - 2000 - KKR launched Capstone - 2000 - Vista was founded with its Vista Consulting Group - 2005 - Insight launched Onsite 𝗠𝗶𝗱𝗱𝗹𝗲 𝗠𝗮𝗿𝗸𝗲𝘁 𝗣𝗮𝗿𝘁𝗶𝗰𝗶𝗽𝗮𝘁𝗶𝗼𝗻 - in the 2010s, more middle-market and lower-middle-market firms decided to build out their own portfolio ops teams. JMI, Serent, Turn/River, PSG, Silversmith, Level and others all hired or promoted the current Heads/Partners of their ops teams in this period. Having an ops team is valuable in multiple ways–for accelerating revenue/margin improvements, and also for prospecting and fundraising. But building an internal consultancy is expensive. With $1B or $3B or even $10B in AUM, it’s hard to support a large, consultancy-type ops team like the ones the $100B AUM funds pioneered. And that brings us to… 𝗠𝗼𝗱𝗲𝗿𝗻 𝗣𝗼𝗿𝘁𝗳𝗼𝗹𝗶𝗼 𝗢𝗽𝘀 - “the router model” takes hold—firms that couldn’t afford (or didn’t want to support) large internal consulting teams are leveraging tech and their broader networks to amplify the impact of fewer ops FTEs. The firm team becomes the “hub”, knowledgeable about both the firm’s portfolio companies and their broader resources, and able to channel questions and needs into reusable assets, one-to-many discussions, and networks of advisors and vendors. My prediction for the 2020s: we're entering an era of higher leverage value creation. If you'd like to see our full report or talk "Modern Portfolio Ops", drop me a note!

How big should a firm's portfolio ops team be? That's a subject for a discussion vs. a LinkedIn post. But I CAN tell you how big they typically are. On average, firms spend 9 bps of AUM on their ops teams (more at smaller firms). On average, firms staff 1 ops FTE for every $1.5B in AUM (more at smaller firms). On average, firms staff 1 ops FTE for every 5 investing FTEs. On average, firms staff 1 ops FTE for every 10 portfolio companies. If you'd like to chat through the nuance, let me know :). And if you'd like to read OneGuide's full State of Portfolio Ops Report, head to our website. askoneguide dot com backslash report

In our State of Portfolio Ops Report, we divide firms into 4 buckets: 𝗟𝗶𝗴𝗵𝘁 𝗢𝗽𝘀: 𝟭-𝟮 𝗢𝗽𝘀 𝗙𝗧𝗘𝘀, 𝘂𝘀𝘂𝗮𝗹𝗹𝘆 𝗴𝗲𝗻𝗲𝗿𝗮𝗹𝗶𝘀𝘁𝘀 𝗼𝗿 𝘁𝗮𝗹𝗲𝗻𝘁 𝗹𝗲𝗮𝗱𝗲𝗿𝘀. Lowest cost, but you have to "pick your spots" on what the ops team does. Can be a strong fit at newer/smaller funds where investing partners don't have too many portcos and are deeply involved in value creation. 𝗚𝗲𝗻𝗲𝗿𝗮𝗹𝗶𝘀𝘁 𝗢𝗽𝘀: 𝟯-𝟭𝟭 𝗙𝗧𝗘𝘀, 𝘂𝘀𝘂𝗮𝗹𝗹𝘆 𝗲𝘅-𝗰𝗼𝗻𝘀𝘂𝗹𝘁𝗮𝗻𝘁𝘀 𝗼𝗿 𝗲𝘅-𝗖𝗘𝗢𝘀 Great if you want to have a strong generalist own the relationship with a fixed number of portfolio companies, usually 2-4. But by definition, these people aren't specialists (so they need to be "routers" to specialists). 𝗖𝗲𝗻𝘁𝗲𝗿𝘀 𝗼𝗳 𝗘𝘅𝗰𝗲𝗹𝗹𝗲𝗻𝗰𝗲 𝗢𝗽𝘀 : 𝟯-𝟭𝟭 𝗙𝗧𝗘𝘀, 𝘂𝘀𝘂𝗮𝗹𝗹𝘆 𝗲𝘅-𝗖𝗧𝗢, 𝗖𝗥𝗢𝘀, 𝗖𝗙𝗢𝘀 𝗲𝘁𝗰. Good for firms with a tight investment scorecard (relatively homogenous portfolio) where a senior CXO can be a valuable advisor or even interim exec. But, "too many cooks in the kitchen" can come into play if you have 5 CoEs all trying to run projects with the same portco at the same time. 𝗙𝘂𝗹𝗹 𝗦𝘁𝗮𝗰𝗸 𝗢𝗽𝘀: 𝟭𝟮-𝟭𝟬𝟬+ 𝗙𝗧𝗘𝘀, 𝘂𝘀𝘂𝗮𝗹𝗹𝘆 𝗮 𝗺𝗶𝘅 𝗼𝗳 𝗴𝗲𝗻𝗲𝗿𝗮𝗹𝗶𝘀𝘁𝘀 𝗮𝗻𝗱 𝘀𝗽𝗲𝗰𝗶𝗮𝗹𝗶𝘀𝘁𝘀 Offers the most control and repeatability, and enables firms to offer pooled services at below-market rates if the firm also staffs more junior "doers" to the ops team (e.g. executive recruiting, pricing consulting, and increasingly, AI enablement). But, big teams are $$$. For more info, and cuts on how much firms spend on these different types of ops teams, grab a copy of the full report from our website: https://lnkd.in/ghMc-feV

We surveyed portfolio ops leaders at our 2026 AI in Value Creation Summit. Two questions showed the gap that is the whole story of AI in PE right now. ⠀ Question 1: At what share of your portfolio companies has at least one department successfully adopted AI? 𝟱𝟭% 𝗼𝗳 𝗳𝗶𝗿𝗺𝘀 said more than half their portfolio. ⠀ Question 2: At what share of your portfolio companies has a large AI project succeeded? 𝟲% 𝗼𝗳 𝗳𝗶𝗿𝗺𝘀 said more than half their portfolio. ⠀ So, AI is everywhere in the portfolio, but it has still struggled to move revenue and/or EBITDA at scale. ⠀ My take: the really valuable AI opportunities tend to be idiosyncratic. They depend on how a particular company actually operates. So transformational AI is less like rolling out a new software tool and more like pursuing any other major value creation thesis: bespoke, cross-functional, leadership-intensive, and hard to execute well. ⠀ Full report: askoneguide dot com slash report