Exits are the ultimate measure of a private equity firm’s success. When the right buyer emerges, advanced preparation of a portfolio company’s financials ensures the due diligence process is swift, smooth, and successful.
“One of the biggest factors in completing a sale is trust in the financial statements,” says Chris Hartenstein, Managing Director at Consero Global. “If the buyer can trust the numbers, they can trust the valuation behind the offer.”
Hartenstein explains how a dedicated finance and accounting partner creates the best impression for a potential buyer and accelerates the path to a profitable exit.
Disorganized Financials Derail Deals
When PE firms install Consero at the portco level, the financials are often in disarray, a situation that erodes buyer enthusiasm and creates deal-threatening delays.
- Unreliable Numbers: If a buyer cannot trust the numbers, they cannot trust their valuation.
- Outdated Reconciliations: Portfolio companies may have accounts that have not been reconciled for six months or even a year.
- Overwhelmed Teams: Rapid growth can outpace a company’s internal finance staff and resources, leading to inefficient processes for handling vendor bills or client invoices.
- Manual Processes: Preparing the necessary schedules and reports for a buyer becomes a time-consuming, manual effort that slows momentum.
Consero’s Single Solution Builds Trust and Speed
Consero deploys disciplined processes and proprietary technology to organize a company’s books, making financial data reliable and easily accessible within 30-90 days.
Right-Size Finance for the Lower Middle Market
For the cost of roughly one senior accounting hire, Consero provides a full team of finance and accounting experts with processes tailormade for growth-stage firms.
- Replace overextended internal teams with the scalable Finance as a Service (FaaS) model.
- Introduce best-in-class processing for payables, receivables, close, reporting, and FP&A.
- Free the CFO to focus on strategy, growth, and the deal.
Audit-Ready Financials
Consero establishes a hard monthly close process, complete with reviewed support schedules. This ensures financials are always accurate and up-to-date.
- Identify and remediate gaps (e.g., unreconciled accounts, messy ledgers).
- Standardize policies and procedures so the close is consistent and repeatable.
- Produce buyer-ready schedules and support on demand.
Disciplined Monthly Closes ControlDock™ Workflow System
This proprietary system calendars every finance task and places it in an approval-based workflow. Nothing is considered complete until it receives the proper review, so no detail falls through the cracks.
- Calendar every task in the finance function and place it in workflow.
- Enforce hard month-end closes with reviewed support schedules.
- Require proper approvals from Consero and the client Controller/CFO before anything is “closed.”
Always-on Visibility with SIMPL® Financial Console
Consero’s AI-driven platform gives clients 24/7 access to everything from high-level financial dashboards to transaction-level details and support documents, all in one place.
- Centralize dashboards, transactional details, and support documents.
- Provide 24/7 access to real-time financial information.
- Eliminate ad-hoc data hunts during diligence.
“When a buyer asks us for a bunch of schedules and we’re able to deliver them within the day, that makes quite the impression,” says Hartenstein, who once saw a deal close just thirty days after the Letter of Intent (LOI) was signed.
What GPs and Buyers Notice During Diligence
- Speed: Rapid turnaround of buyer requests inspires confidence.
- Consistency: Documented processes produce reliable monthly closes.
- Transparency: Real-time access reduces back-and-forth and keeps momentum.
- Continuity: Finance operations don’t stall if personnel changes occur.
Case Study: PayPal’s $400M Acquisition of Hyperwallet
Hyperwallet’s successful exit demonstrates Consero’s impact on preparing a company for a strategic acquisition.
- Client: Hyperwallet, a $65M revenue online mobile platform
- PE Sponsor: Primus Capital
- Acquirer: PayPal, Inc.
- Exit Transaction: $400 Million
Challenges Before Consero
- Frequent turnover in the finance function.
- CFO was consumed with daily financial operations, not strategy.
- Financial reports were created in Excel and lacked deep analytics.
Finance as a Service Solution
Consero managed all back-office finance, accounting (transaction processing, closing, reporting), and FP&A.
- Freed Executive Focus: The CFO could focus on the transaction without worrying about organizing financials.
- Inspired Buyer Confidence: Consero’s professional team and processes assured everyone involved in the due diligence process.
- Informed Decision-Making: The company gained confidence that its financials were timely and accurate.
- Cost Savings: Achieved a 30% savings compared to maintaining an in-house team.
Post-Close: Keep What Works
There are typically three scenarios post-close:
- Acquiring firms often retain Consero after closing because the finance function runs efficiently and accurately.
- Strategic buyers prioritize integration elsewhere; Consero maintains steady-state finance.
- If a new CFO joins post-deal, Consero trains them to leverage existing workflows without disrupting operations.
A Clear Financial Story Drives Successful Exits
Clean, timely, and transparent financials tell the story of value creation during a PE firm’s ownership, and let buyers validate it quickly. If that story is confusing, poorly told, or not substantiated quickly, a buyer may not wait for the seller to get it straight.
Consero’s processes, technology, and managed team ensure the financial story is clear, credible, and verified, so PE firms can move from LOI to close with momentum.
Schedule a call today, in 30 minutes we’ll show how to prepare for your portco exit.
