By: Frank Scarpelli, Managing Partner - Sparc Partners

When Apollo Global Management acquired ADT Security in 2016, they didn’t just buy a home security company—they invested in a transformation story. Significant leadership changes followed, aligning the company with Apollo’s strategic goals. By January 2018, ADT had gone public again with an initial valuation of approximately $10.5 billion—a substantial increase from its $6.9 billion acquisition price. ¹

This isn’t uncommon. Historically, private equity firms have driven growth through leadership transformations. However, with only 38% of PE firms expecting to increase portfolio company headcount in the next 12 months—a shift from previous years—it’s clear that firms are becoming more strategic in their approach. Rather than simply hiring more people, today’s PE leaders are focusing on upgrading leadership, optimizing teams, and ensuring they have the right talent to drive value creation in a competitive landscape.

The New PE Playbook: Talent First, Finance Second

Gone are the days when private equity firms could rely on financial engineering alone to create value. Today’s most successful PE deals start with a crucial question: Do we have the right people to drive this transformation?

“We’ve seen deals fall apart in diligence when we realized the leadership team couldn’t execute our growth strategy,” shares Sarah Chen, Managing Partner at Elevation Capital. “But we’ve also seen mediocre companies become market leaders when we got the talent piece right.”

Before You Sign: The Pre-Deal Talent Checklist

Smart PE firms now treat talent assessment as seriously as financial due diligence. Here’s what they focus on:

Leadership DNA

• Is the current leadership team capable of driving PE-paced growth?
• Beyond track records, firms use sophisticated assessment tools to evaluate executives’ ability to thrive in a high-pressure PE environment.

Cultural Readiness

• Can this organization handle rapid transformation?
• The best deals happen when there’s alignment between company culture and the PE firm’s vision for change.

Hidden Gems

• Which middle managers could step into bigger roles?
• The real value-creators often aren’t in the C-suite but one or two levels below.

Post-Deal: When the Real Work Begins

Here’s where theory meets reality. The first 100 days after acquisition are critical—and talent strategy leads the way.

The Talent Acceleration Timeline

Month 1:

• Deepen Executive Leadership Team assessment. Extend evaluation to 2nd-tier leadership talent
• Identify critical roles and talent gaps
• Launch executive search for key positions

Months 2-3:

• Deploy interim leaders to fill gaps
• Initiate cultural transformation efforts
• Start building a talent pipeline

Months 4-6:

• Onboard new executives
• Roll out leadership development programs
• Implement performance management systems

The Secret Weapon: Interim Leadership

One of the most effective tools in modern PE talent strategy is the use of interim leaders.

Take Manufacturing Co. (name changed), a PE-backed industrial supplier. A 6-month gap could have derailed their value-creation plan when their CEO unexpectedly departed mid-transformation. Instead, they brought in an interim CEO with deep PE experience who:

• Maintained momentum on key initiatives
• Mentored high-potential executives
• Helped select and onboard the permanent CEO

Building for Scale: The Talent Multiplier Effect

Smart PE firms don’t just hire for today—they build leadership teams that can drive future growth. The right executives aren’t just a fit for where the business is now but for where it needs to be in three to five years. Hiring with a long-term vision ensures leaders can scale operations, navigate transformation, and create lasting value.

Leadership Development on Steroids

• PE-backed companies need leaders who can handle hypergrowth.
• Custom development programs help build these capabilities internally.

Strategic HR Partnership

Modern PE firms transform HR from a support function to a strategic driver:

• Design scalable org structures
• Build compensation plans that drive performance
• Create recruiting engines for rapid growth

Making It Work: Practical Tips for PE Talent Strategy

1. Start early – Talent assessment should begin before the LOI.
2. Build flexibility – Use a mix of permanent and interim leaders.
3. Invest in leadership development from day one.
4. Create accountability & metrics for talent initiatives.
5. Don’t underestimate cultural alignment – It’s as important as financial fit.

The Bottom Line

In today’s PE landscape, the firms that win aren’t necessarily those with the most capital—they have the best talent strategies.

As competition for deals intensifies and multiple expansion becomes harder to achieve, the ability to identify, attract, and develop the right talent at every stage of the deal lifecycle isn’t just an advantage—it’s a necessity.

The most successful PE firms have realized: Talent strategy isn’t a cost center—it’s the biggest lever for value-creation.

Whether you’re on the buy side or selling to PE, understanding this shift is crucial for success in today’s market.

About the Author

Frank Scarpelli is a trusted advisor to the private capital sector, bringing decades of experience in driving growth and transformation for organizations of all sizes, from SMBs to enterprise-level companies. With a strong focus on private equity, venture capital, and family offices, Frank specializes in aligning human capital and technology strategies to support the full deal lifecycle, from due diligence and acquisition to growth and exit.

About Sparc Partners:

About Sparc Partners: Sparc Partners provides tailored executive search, leadership consulting, and a full spectrum of advisory services. We work closely with organizations in the Private Capital sector, including Private Equity (PE), Venture Capital (VC), Mergers & Acquisitions (M&A), and Family Offices. Looking to upgrade your PE firm’s talent strategy? Let’s continue the conversationwww.sparcpartners.com

Footnotes:

• ¹ Apollo’s ADT Acquisition & IPO Valuation: Reuters‍
• ² PE Headcount Trends (2023 Survey Data): Private Equity International