Banff

Operating Partner ("OP") roles have become highly coveted positions, but what exactly are they, how do you land these roles and what’s the biggest risk associated with taking the leap? OPs are key value creation partners at private investment firms. They are functional leaders who work directly with the C-suites across a portfolio to enhance each company’s ability to deliver or exceed intended outcomes. But no OP role is the same - and many firms treat and hire for the function differently, depending on stage and investment style. - Growth firms will typically look for CEO whisperers, proven CRO & GTM experts, CMOs. - Traditional PE firms will look for change management experts, COOs and CTOs focused on infrastructure modernization and efficiencies and cost-cutting CFOs. Proven operators are the most natural candidates. Those that have led companies to achieve significant performance objectives or from funding rounds through to IPO - especially leaders who have demonstrated their ability to rinse and repeat their special sauce. This gives investors conviction their methods can work at scale. If this is you, great. Consider: - Do you want to work with a portfolio of companies vs. just one? - Have you made this choice purposely or accidentally? There are consequences in terms of what you might / might not be considered for going forward. - Is your skillset better aligned to Growth or Private Equity? - Are you OK not being a leader within the company itself, but a partner who sits “on the outside” without full control? - Can you articulate your numeric successes? PE investors are incredibly metrics-oriented. If you haven’t been a repeat-operator, get your feet wet as an advisor to private companies at various stages. Proving your value-add as an advisor can help position you for conversations with investment firms. One often overlooked risk of shifting to an OP role is the hard truth that this move signals “you’re done with your operating career.” That’s not to say it’s impossible to find your way back, it can just be much harder. If you’re considering the move, ask these questions of the investors you approach: - Where does the function sit within the organization? - Do they expect you to run a “playbook” on each portco, or do they believe in a custom approach that caters to each company? - What’s the relationship between investors and OPs? How do they work together? Ratio of investors to operating partners? - How does the firm measure success for OPs? - Did they firm pull back on the function as a way to cut cost or did they double down on adding value creation experts to enhance portfolio outcomes, as they have been forced to hold onto companies longer? - How is the position compensated? Does comp include carry? Banff is here to help you navigate the career journey that’s right for you. If you’d like to learn more about the Banff Executive Network, please reach out to executive-services@banffadvisors.com

Congrats Erin Lantz on your appointment to the board of publicly traded ($7B market cap) Meritage Homes!

For those in our Banff executive network, next week we will be sharing our "Views from Banff" Q3 report highlighting what we are hearing/seeing in the market. Below is a little "short and sweet" teaser of some of the highlights - if you'd like to be part of the network, please reach out to us at executive-services@banffadvisors.com. - While PE deal activity has picked up, overall there continues to be a focus on getting more from existing investments (versus exits). This has impacted role profiles (CFO roles with FP&A upbringing, versus M&A/ strategy) as well as hiring (funds seeking Operating Partners has picked up quite a bit; we actually have a private event we are hosting with select OPs and GPs next month to discuss this). - The consumer market had been pretty quiet, though a few areas are certainly picking up. Consumer services and anything subscription-based (as it relates to PE interest). And more and more investment in celebrity-centered companies. They often have the brand, distribution, and capital to "go big", but need operators to come in and build/run these businesses. These are often in niche segments - health, wellness, sports, foods. - CEO succession has always been a major topic for public companies, but as PE firms hold their investments longer, we are seeing it come up quite a bit for private as well. Different than the typical invest & replace play, these are more long-term succession processes for CEOs/boards, many not accustomed to it. - Demand for several functions "is back" after being quiet for 1+ years. The CMO market has picked up tremendously - including an increase in demand for the “typical” brand-focused and brand-building CMO. This also includes the desire for CMO+ profiles for public boards. And PE-driven deal flow has sparked the desire for PE-experienced HR heads as one of the first hires for the new CEO. - Is Sales+Marketing leadership coming together again? Conversations continue to look at whether sales and marketing roles will "re-merge". From a client at a large SaaS player - "75% of interactions between a product and a prospective client happen before they meet the first sales person. People would much rather self discover for as long as they can." Much more behind all of this in our Q3 Views from Banff, coming to Banff executive network next week.

The call is coming – your current role, a new role – compensation review, an offer. What should you ask for? Always more – 90% of execs leave something on the table that the company was willing to give them - but let’s raise it up a level here. “Compensation” or the benefit to you could also include the title, the brand, the exposure to certain types of people. So, think of your career in 3 year “chunks”. For the next 3 years, what are you optimizing for? Is this a "final" operating role? If so, perhaps it's cash. There is nothing wrong with that. Optimizing for short term wealth creation is a very appropriate decision – but know what that means. It means your next role is not an early stage start-up. It might not be a PE-backed 6-7 year turnaround. The clock matters. Or perhaps this is the thing that sets you up for the thing. So optimization is more towards title and/or adding responsibilities and experiences that would be a gap for the step you want to take. Do you know what that gap is - you need to know why they would say no. Back to title. If you're thinking about future board/advisory work, title matters. 92% of F500 board seats last year went to former CEOs, CFOs or COOs (especially the first two). Maybe this is the chance to check the box so you have it. Maybe it’s exposure. To a board. To investors. The annuity of those relationships for what you want to do next. When you know what you are optimizing for right now, then "compensation" is the sum of many components, which each weighted slightly differently. Banff can help

Planning to DO the job is NOT the same as planning to GET the job. Especially CEO processes, especially when you are the internal candidate. Female candidates fall into this more than male candidates. You must plan to get the job AND plan to do the job. - Planning to get the job takes years not months. You don't start saving the day before you want to buy a house, don't start playing the game in the final minutes either. - If you are an internal candidate, you are often at a disadvantage. Like a 4-year college athlete readying to go pro, there is more "tape" on you. They have all the reasons why you are not right. For an external candidate only the good stuff shows (the freshman phenom). - Get to know the Board ahead of time. Way ahead of time. If you are meeting the board for the first time during the CEO interviews, it's often too late. You need champions in that room. - Know the reasons they would NOT think you are right. There is always something. Know it. Find out what it is. Lean into shifting it in meetings, drinks, interviews. - Be wanted. Externally. It does not mean you need to be out interviewing and job seeking. But build a brand as a star, as someone coveted. Have someone at your side. Banff, your first call for executive connections and intelligence.

At Banff we serve our clients via Trusted Guidance, Powerful Connections and Actionable Insights. A few outtakes from our latest report: - The re-emergence of President / COO searches in VC-backed mid stage companies signals a return to growth for many. For most of 2023 if they were hiring it was to bring in a head of sales to try to turn on growth, a CFO to try to save cash, a CEO to replace a founder. The growing number of President/COO searches in the market signals a new mindset. - Independent board directors are being sought much earlier in a company's life cycle - historically it had been post series B at the earliest, now we are seeing even earlier - The IPO pipeline continues to build. Large firms who were over-valued last year have now level-set and are very active in M&A / acqui-hiring to get ready for an IPO. - The above momentum includes starting to create board pipelines to build the IPO/public board. - Private equity is back; what was months of dating and getting to know for back-able CEO/CFOs last year is now multiple term sheets on deals agreed upon but not yet closed. - For established regulated public companies, there is a bias to lean on CEOs in similar companies today, or very recently. Those who moved to early stage companies in '21-'23 are sometimes being excluded as "too long" out of the regulated/large seat. - If you're a SaaS CEO/CFO, you are getting 8-10 calls a week. If you are SaaS adjacent and want those calls, expand your brand, reputation and networks - there is a major supply challenge. Our clients know to Ask Banff

While we are not a business designed to place job-seekers, there are times Banff's clients are in transition. The leading executive search teams know and trust Banff to source us for their work. Over the past 12 months, our discreet recommendations to the industry's top search teams have led directly to companies hiring - and leaders becoming: ·     CEOs, PE-Backed Technology ·     CEOs and COOs, Series B-C SaaS ·     CEO, Top 30 Bank ·     Publicly-traded Board Directors (many) ·     Private growth stage Board Directors (many) ·     COOs and Operations Heads, Public Consumer Marketplaces ·     Heads of Human Resources (many) If you are a search team working on pedigree searches, contact us. Our goal is to make the system work better for everyone, in a highly curated, very carefully vetted manner. If you are a corporation who covets top leaders and leverages executive search teams, encourage them to source us.

What we've been building at Banff is not just a service, or a product or two, but a way to completely reshape how the best and brightest executives, and the companies who want access to them, achieve their ambitions. In short, we are "Redefining Access and Enabling Connection". And now we finally can share everything that we do, and the amazing team behind it all - with our overhauled new website: www.banffadvisors.com