Private equity investment can bring ambitious plans to a fresh produce business. There may be opportunities to enter new markets or increase capacity, with plans to accelerate growth that was already underway.
For the senior team responsible for delivering those plans, investor ownership can also change the leadership environment. Investors will have expectations for the business during the investment period, while the executives running it have a detailed view of what is happening commercially and operationally.
Those two perspectives won't always lead to the same conclusion at the same time.
That puts senior leaders in an important position. They need to understand what investors want to achieve, while giving them a clear picture of what is happening inside the business. When the two pull in different directions, the executive team has to find a workable way forward.
For a PE-backed fresh produce business making a senior hire, that part of the role needs to be clear from the beginning of the search.
Investor ownership can change the leadership brief
A senior role can look quite different once you get into the detail of how the business is owned and run.
An executive joining an investor-backed company may have a closer relationship with the board or investors than they have experienced before. There may be specific expectations attached to the investment plan and greater scrutiny of how the business is performing against it.
The level of investor involvement will vary from one business to another. The company may also be at the beginning of its investment period or several years into it, with different priorities from those it had when the investment was first made.
All of that affects the leadership brief.
Before beginning a search, it helps to be clear about the environment the incoming executive will be working in. How closely will they work with investors? Where will they have the authority to make decisions? What is expected from the business over the coming years?
These questions give you a much better basis for assessing candidates than simply looking for someone who has held the right title in another PE-backed company.
Growth still has to work in a fresh produce business
In fresh produce, growth plans also have to work within the realities of the business itself.
Increasing production can require investment well before any additional product reaches the market. Crop cycles affect timing, and the availability and cost of labour can have a significant bearing on what a business can deliver.
Perishability adds another layer. Additional volume has to move through the supply chain and reach the right customer within the available window, so increasing production can have consequences elsewhere in the operation.
For the senior team, the challenge is turning commercial ambition into a plan the business can carry out.
That may mean explaining why a target will take longer to reach than expected, or showing what additional investment would be needed to reach it. There may also be occasions when the original plan needs to change because conditions within the business or market have changed.
A strong relationship between investors and the executive team makes those conversations easier. Investors need a clear view of what is happening inside the business, while operational leaders need to understand the commercial expectations behind the investment plan.
An executive who can connect those two perspectives can help both sides make better decisions.
Look beyond growth on the CV
If growth is a major part of the investment plan, previous growth experience will naturally be relevant when assessing candidates. But the circumstances in which someone achieved those results can tell you far more about how well suited they are to the role you're hiring for.
A candidate may have grown a business with substantial investment behind them, for example, while another may have achieved similar results in much tighter commercial conditions. The headline result may look comparable, even though the leadership experience behind it is very different.
Exploring how the candidate made decisions, what they were personally responsible for and how they responded when plans changed gives you a fuller picture of what they can bring to the business.
Previous PE-backed experience can be useful too, particularly when someone has already worked closely with investors or a board. The question is how relevant that experience is to the business you're hiring for.
Someone coming from a different ownership environment may have dealt with comparable commercial pressures or worked with demanding stakeholders. What counts is whether their experience has prepared them for the circumstances they will face in this business.
That makes the search brief much more specific. You're looking beyond the PE label on the CV and examining how the candidate has actually led.
Candidates are assessing the ownership environment too
The ownership model isn't only something for the client to think about during the search. Senior candidates will be assessing it as well.
Some executives are very attracted to PE-backed businesses. The opportunity to lead during a period of growth, work closely with investors and have a significant influence on the direction of a company can be appealing.
Others will have more questions before they are comfortable making the move.
They may want to understand the relationship between the leadership team and investors, particularly how decisions are made in practice. The point the company has reached in its investment period can be relevant too, especially for a candidate thinking about what the next few years could look like.
The eventual exit may also come into the conversation. A candidate could reasonably want to know what is currently understood about future ownership and what that might mean for the business or their own position.
There won't always be firm answers, particularly when an exit is still some way off. Being clear about what is known gives candidates a more realistic picture of the opportunity and gives the client a chance to understand any concerns before they become an obstacle later in the process.
That conversation can be especially useful with a candidate who has never worked in a PE-backed company before. They may have assumptions about what investor ownership will mean, so understanding what this particular business is actually like can help them make a more informed decision.
Working between investors and operations
Investors and operational teams can see the same situation differently because they are looking at the business from different positions and may have access to different information.
A senior executive working between them needs to understand both.
When investors are focused on the commercial plan, the executive can explain what the business will need to deliver it. If something isn't working as expected, they need to be able to explain why clearly enough for the board to make an informed decision.
There will also be occasions when they need to challenge an assumption. Doing that well requires credibility on both sides. The executive needs enough understanding of the operation to explain the implications of a decision, alongside a clear grasp of what the investor is trying to achieve.
And once those conversations have happened, they need to translate the outcome into something the wider business can carry through.
This can be difficult to capture in a conventional role specification. Asking for someone who is commercial, growth-focused or experienced in PE doesn't tell you how they will handle disagreement with an investor or explain a difficult operational reality to the board.
The search process gives you the opportunity to explore those situations in detail. Looking at how candidates have handled comparable circumstances before can tell you far more about how they are likely to operate when the pressures of the role become real.
Make the ownership environment part of the search
There is no single profile for a senior leader in a PE-backed fresh produce business. What you need depends on the company, its investors and what the business is trying to achieve during the investment period.
Building that context into the search from the outset helps you assess candidates against the role they will actually be doing. It can also make the opportunity clearer for candidates, particularly those who are deciding whether PE ownership is an environment they want to work in.
For fresh produce businesses, finding a leader who understands the operation is clearly important. When that person will also be working closely with investors, you need to understand how well they can connect the commercial expectations of the investment plan with what the business can deliver.
LCR International specialises in senior executive search across the global fresh produce industry. If you're hiring a senior leader into a PE-backed fresh produce business, get in touch with the LCR team to discuss your search.
