In this episode of The Private Equity Podcast, Alex Rawlings is joined for a second time by Brian Gustason, Fractional Operating Partner at BG Operating Advisors.
Brian explains why many lower-middle-market businesses struggle to scale after receiving institutional investment and how private equity firms can professionalise their go-to-market strategy.
The conversation explores founder dependency, underdeveloped sales and marketing capabilities, and why firms must assess the maturity of the entire revenue engine before attempting to accelerate growth.
Brian also outlines the importance of route-to-market analysis, including reach, fit and yield, and explains why growth should be treated as an interconnected system covering marketing, sales and customer success.
The episode also examines go-to-market integration within roll-up strategies, the importance of execution fit during due diligence and how operating partners can help portfolio companies sequence growth initiatives more effectively.
Key Highlights
Why founder-led businesses often struggle to scale
The risks of founder dependency in sales
What Brian means by “phase zero” capabilities
Why firms may need to go backwards before scaling forwards
How to professionalise a go-to-market strategy
The importance of route-to-market analysis
Understanding reach, fit and yield
Why lower-middle-market businesses hit growth ceilings
The challenges of integrating founder-led businesses in a roll-up
Why go-to-market integration should be pre-wired
The importance of execution fit during due diligence
Why growth stalls are not always sales problems
Customer success versus customer support
How existing customers can drive expansion revenue
Separating revenue results from the revenue engine
How operating partners can support commercial transformation
Why growth initiatives must be sequenced correctly
Timestamps
00:00 – Introduction to Brian Gustason and BG Operating Advisors 01:01 – Common growth challenges in the lower-middle market 01:31 – Founder dependency and underdeveloped commercial capabilities 02:29 – Identifying phase zero go-to-market capabilities 03:56 – Defining a professionalised go-to-market strategy 04:23 – The role of go-to-market strategy in private equity 05:17 – Why route-to-market analysis is often overlooked 05:47 – Understanding reach, fit and yield 07:14 – Why founder-led businesses often lack scalable processes 08:38 – Growth ceilings and limited execution runway 10:05 – Go-to-market challenges in roll-up strategies 11:34 – Pre-wiring go-to-market integration 13:01 – How deal origination affects integration 13:58 – Execution fit and time to integration value 15:51 – Diagnosing the real causes of stalled growth 16:40 – Treating go-to-market as a connected system 17:08 – The role of customer success in recurring revenue 18:33 – Unlocking growth from existing customers 19:53 – Assessing whether the revenue engine can scale 20:22 – Separating revenue performance from revenue capability 21:20 – Evaluating go-to-market maturity 22:42 – Where to play, who to target and how to engage 24:10 – How operating partners can support portfolio companies 24:37 – The operating partner’s role in due diligence 25:35 – Identifying businesses that need growth intervention 26:31 – Sharing best practices and coaching leadership teams 26:59 – Sequencing growth initiatives effectively 27:29 – How to connect with Brian Gustason 27:57 – Closing remarks
Raw Selection partners with Private Equity firms and their portfolio companies to secure exceptional executive talent. We focus on de-risking executive recruitment through meticulous search and selection processes, ensuring top-tier performance and long-term success.
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