Revenue Rehab: It's like therapy, but for marketers
April 27, 2022

Private Equity Pitfalls: PE Dynamics & How They Can Get in the Way

In the episode “Private Equity Pitfalls: PE Dynamics & How They Can Get in the Way”, Brandi Starr was joined by Jenn Steele, the VP of Marketing at Reprise, a demo creation platform that helps companies sell their product with their product. An...

In the episode “Private Equity Pitfalls: PE Dynamics & How They Can Get in the Way”, Brandi Starr was joined by Jenn Steele, the VP of Marketing at Reprise, a demo creation platform that helps companies sell their product with their product. An enthusiastic advocate for Product-Led Growth (PLG), she is excited to get the word out about how Reprise helps companies increase their conversion rate by 60%.

In this episode, Brandi and Jenn discuss how the dynamics of private equity can present as obstacles for a CMO. Since the structure of PE firms is largely dictated by the board and how those funds are spent, this can present major challenges for CMOs. 

Jenn Steele walks us through the structure of a PE firm, and how the departments (sales, finance), are viewed by the PE firm board and what that means to Marketing.  

Emphasizing how finance and budgeting heavily informs the conversation and decisions at PE firms, Jenn discusses how to navigate this structure and gives some tips on avoiding Private Equity Pitfalls.

Bullet Points of Key Topics + Chapter Markers:

  • Topic #1 If you knew then what you know now; marketing for PE backed firms [4:17] While Private Equity firms are finance focused, you are very much focused on revenue minus cost. Jenn explains how that point of view informs their approach to Marketing.
  • Topic #2 Budget, budget, budget. Did we mention budget? [14:58]
    Discipline around budgeting is critical.  EBITA (Earnings before interest, taxes, and amortization) becomes the key directive to what you can do and how to deliver on the role as CMO in a PE firm. Jenn explains how this is the foundation to successfully executing the role.
  • Topic #3 Where does private equity bring challenges that you may not see other places? [21:26] Teams and tradeoffs.  Jenn highlights the challenge of juggling resources, and what you can and can’t live without.

So, What's the One Thing You Can Do Today?

If you’re already in a Marketing role at a Private Equity firm and it’s a bit bumpy, Jenn stresses the importance of discovering where your board members are coming from.  Jenn says, “because it’s all about the budget and the number’, your CFO can help you there.   They can help you to figure out what your board really wants, which in turn, will lend to future success.

Buzzword Banishment:

What’s the one word that makes Jenn Steele wince? “Synergy”.  It is misused and rarely suits the conversation; just say what you mean.


Get in touch with Jenn:

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Intro VO  00:05

Welcome to revenue rehab, your one stop destination for collective solutions to the biggest challenges faced by marketing leaders today. Now head on over to the couch, make yourself comfortable and get ready to change the way you approach revenue. Leading your recovery is modern marketer, author, speaker and Chief Operating Officer at Tegrita Brandi Starr.

Brandi Starr  00:34

Hello, everyone and welcome to another episode of revenue rehab. I am your host, Brandi Starr, we have another amazing episode for you today, I am joined by Jen Steele. Jen is the VP of Marketing at reprise a Democratic platform that helps companies sell their products with their product, and enthusiastic advocate for product lead growth. She is excited to get the word out about how reprise helps companies increase their conversion rates by 60%. Jen, welcome to revenue rehab, your session begins now. So good to be here. I am excited to have you. And you know, it's funny, like we're, I know that you were like the expert. So I may have to like bring you back to the couch later to talk about that. But we're gonna cover something completely different today. But before we jump in, I like to do a little icebreaker have a little Gusau moment that I like to call buzzword. banishment. So tell me what buzzword would you like to get rid of forever?

Jenn Steele  01:51

There is a word that there is no way that I don't wince when people say it. And people often say it in the sales and marketing working together. And that's the word "synergy". I absolutely hate it. I absolutely hate it.

Brandi Starr  02:05

Yeah, I think that is one of those words that most people don't truly understand the definition of synergy. And I it's almost like they get tired of saying alignment. And so they just switch it up and just start saying synergy.

Jenn Steele  02:22

Meeting is great. The word itself. Yeah, I think you're right. It's totally misused. And it. Also, I think it's the people who tend to use it are the ones who want to appear smarter than they are. So that kind of bugs me.

Brandi Starr  02:35

Yeah, and that's probably one of the common things with the buzzwords, I can say that is one I at least don't use. I know a lot of times the words that people want to banish, I kind of cringe a little bit because I'm like I say that

Jenn Steele  02:49

marketing attribution? I'm, like, visible for crying out loud, like marketing attribution. That was my jam. What are you talking about?

Brandi Starr  02:56

Yeah, that, you know, there's so many of them. And I'm just, you know, kind of like, you know, shame like that. I say that word all the time. But Synergy is one I rarely say. So we can put that one in the box, throw away the key, we will not say synergy while we are at the couch today. So before we go, you know, jump directly in I like to set intentions. It helps to give us focus and purpose. It also lets our audience know what to expect. So tell me what brings you to revenue rehab today? And what would you like to be different after our session?

Jenn Steele  03:36

So a big theme in my life is that I like other people to learn from my mistakes and learn from my learnings, okay? There's that too, like, I occasionally do things correctly, and occasionally share that. But here, we're talking about private equity, which is easier for me to talk about than a lot of folks who are in private equity. Since I am no longer in private, in private equity owned companies. I am now back to venture capital, for very good reasons. But having worked for a couple of different private equity owned companies, there are definitely some some tips that I would love for folks to understand and share so that they don't, you know, fall into the same holes that maybe I did.

Brandi Starr  04:17

Awesome. Yeah, I know, this is a hot topic. I mean, we even look at just how marketing technologies grow year over year, but the same is true for so many other industries, and a lot of startup tech companies and not just tech companies but you know, that's a sweet spot are private equity backed and you have you know, a lot of times the the marketers that are ahead of marketing aren't super seasoned, and many are working with private equity for the first time. And so I know and it's always hard because, you know, nobody who's in it can really talk about it because you know, you don't want to throw your firm under the bus. us or make it, you know, publicly talk about your challenges. So really excited to have you to kind of, you know, pull the lid off, so to speak, and be able to give some direction and advice to those people who are trying to lead marketing, trying to grow revenue when they are PE backed. So my first question is, if you knew then what you know now, what would you do differently in how you have led marketing for PE backed firms?

Jenn Steele  05:40

That's a great question. It's, well, the one thing you have to keep in mind with private equity backed firms is that your being, yes, your board is holding you accountable. And it probably didn't venture and it doesn't public in public companies, although public companies are obviously a lot bigger usually. But these are finance guys, usually guys, sadly. Or they're such finance guys, they probably pronounce it finance. And so until I've learned, and so they're essentially bankers who are on a more operational board than you found in your venture backed company. So I, you know, my first presentation to private equity board, I went in having presented to venture boards, you know, yeah, here's what marketing does are really cheery, and here's some metrics and yay, and here's some tchotchkes And aren't you happy? And that was not what they wanted to see. Right? Yes, they did want to see the sexy stuff, right? We did this at this conference, we did this. And we got these people in the room and etcetera, and so on. But fundamentally, they were more concerned about what I spent, than anything else.

Brandi Starr  06:52

Okay, so spend, and I'm assuming return on spend?

Jenn Steele  06:57

Well, they look at sales for that. And so sometimes, it's really hard to say, hey, marketing does some stuff to here. Now, there are the private equity firms that have the marketing playbook. Right. And so where I spent most of my time did not have a playbook. Well, I kind of wish they had because it would have made my life way easier. Because I could have been like, I know what they're looking for. And whether or not I agree with it, I can just, I think do it. But with in the absence of a playbook it was, it was a lot of managing expectations around what they could see. And as much as I wanted to report on marketing generated revenue, they didn't care as much, because that was in the financial section.

Brandi Starr  07:41

Okay, so what I'm hearing is, the focus is being able to show the activities that are happening, so less around tying to the ROI, but showing here's what we're doing, but almost in a more. It's like, here's what we're doing. But here's what we also spent,

Jenn Steele  08:05

right? Well realize you're you're worshipping at the feet of the EBITA. Right. So, unlike a venture backed firm, where you're entirely top line revenue focused, you are very much focused in revenue minus cost.

Brandi Starr  08:21

Gotcha. Okay, but then they don't like it, I think where the disconnect for me is, but then you also don't want us to show ROI, because you are true

Jenn Steele  08:29

Right And it could be my particular, my particular PE board. The we're a little on the old school side. And so, you know, those of us who who think back 15 years or so back to when marketing was considered arts and crafts, well, that's still their mindset, right? And whereas a VC firm is probably more hip to the fact that marketing actually generates revenue. Now, that's only been something we've been talking about in the last 10 years or so. And so it's, that's I, I believe, granted, I'm not inside their heads. I could be totally wrong here. But I believe that it's the old school perception of marketing as brand and arts and crafts, basically, that made it so hard for them to grok that I was attempting to measure marketing to revenue.

Brandi Starr  09:17

Okay, and in episode four, I talked to Christina around her grit marketing, approach to influence and really focusing on how marketing can have that influence in the boardroom. Do you have any advice? You know, if you're working with private equity, on how to get more mindshare? You know, how to how to bring people forward into here's what marketing really does. Here's the impact, you know, any advice on kind of making that shift in order to be more effective?

Jenn Steele  09:52

Well, it comes down to what we do as marketers all the time. Although, as Christina pointed out, we kind of suck at doing it with ourselves. But, but it's very much you have to meet them where they are and where they are is in the budget. Right. And I, I'm fortunate So marketing is my second career actually used to run IT departments. And so I've had Budget Responsibility for basically my entire career. And somehow I went from it, which was the most the biggest cost center to marketing, which is now the biggest cost center. But, and I, in fact, reported to the head of Finance and Administration whenever I was in it. And as such, my discipline around budgeting is really strict. And that actually helped me a huge amount with private equity, because they care about the budget, right? They set the budget at the beginning of the year, you're stuck with it, if you're not making your revenue, you gotta cut to get to the EBITA number, because that is your goal. That's where the brains are, are we making enough of a profit that we can sell you in five years? Right? That's all they really like, that's, they want a nice, a nice flip on their investment. So you have to meet them, where their brain is, which is the budget, the finance the return on investment, and then you can say, okay, here we go. But they're not going to take some of the squishy ways that sometimes we say, oh, and branded this, right? They'll they'll look at that as convoluted. So that can be really difficult. And it's something that I've had to deal with on a case by case basis. So I don't really have as much insight as I would love to, I would love to share a rule. But sometimes they get it sometimes they don't sometimes they care. Sometimes they don't. Yeah.

Brandi Starr  11:30

But no, I do think that that is good advice in thinking about, you know, because I know like, in my career, I fought so hard to not be viewed as a cost center to really show the value of marketing. But when you were talking about revenue minus costs, like you know, those numbers are, you know, they're hard like that math is clear. And so it is great advice to really think about like to put yourself in that position of here's what they're going to look at. And, you know, being able to justify the costs. And you know, even though they're not looking at marketing, generating revenue, being able to draw direct lines, which when you're talking about building brands like that is where it is a lot fuzzier, and you know, you don't have those clear lines, which, given that so many startups are PE backed, and brand is so important. It's kind of like, here we are in this catch 22 We got to build brand, but we got to do it with spending as little money as possible so that we've got, you know, good math at the end

Jenn Steele  12:40

 Right and that's where getting them excited about things. I mean, they're still humans, right. And so you can still bring the probably high end swag into the boardroom, right. Don't expect them to be as excited about it as your average investor. But you can still, like get them saying, Oh, wow, yeah. Okay, I can start seeing that. Invite them to events that you're like the if you're so I mostly worked with private equity when I market into the enterprise. And so I did a lot of account ABM events, right? Standard, put some customers and prospects in the room, have them talk to each other and magic happens. Invite them to the events, take them out to a nice dinner. Like they start seeing Oh, okay, they're speaking my language, oh, customers really love this stuff that marketing's doing that that do your own PR basically, with your board.

Brandi Starr  13:34

Okay, so that goes back to a we got to do better at tooting our own horns. And creating that visibility internally is kind of the key takeaway that I take from that.

Jenn Steele  13:47

And I kind of suck at it not gonna lie.

Brandi Starr  13:50

I mean, so many people do. It's, it's hard to, you know, sort of market yourself and really, you know, because we're taught not to come across as like arrogance, or, you know, like, you're supposed to be humble, and, you know, all these sorts of things that are great character traits, but not as great, you know, in the boardroom,

Jenn Steele  14:10

especially when you're sitting in the boardroom with sales, who is way better at selling themselves. We are marketing ourselves and and you've got the pre the pre election of the board members to believe that revenue comes from sales. So now you're sitting there going, like, Oh, hey, I'm gonna I'm in a great spot here. You know, you're starting from the bottom of a hole, and that's not very good.

Brandi Starr  14:30

Um, so, you know, kind of what is if if we are thinking about, you know, talking to senior marketing leaders who are looking at their next move

Jenn Steele  14:43

don't do it. No, sorry. I'm kidding. There are private equity owned companies that are completely amazing, and I'm sure I will probably work for one again someday, unless this podcast gets out.

Brandi Starr  14:58

Yes, and you know, the fact that there are challenges does not make them bad, it just means that you can be more effective if you understand what you're walking into. So, if someone's looking at, you know, are considering private equity backed organizations, are there any criteria that you can say like, you know, is having a marketing playbook? Like is that something that is appealing? Or are there other things that people should really look for? To say that, you know, this might be a path to least resistance, or at least worth it in the end,

Jenn Steele  15:37

right. So by and large, I would say don't go private equity unless you're really good at budget. One of the things that, that I loved the most was, when I left my last private equity place at the executive goodbye dinner, the CFO raised a glass and said to Jen, the most financially minded cmo I've ever worked with, you need, hey, look at me, too, in my own horn here. But you need to be financially minded enough that you kind of love budgeting, and you love rejiggering it and you like truing it up and you like doing all of that stuff, which I do, because there's something wrong with my brain. Otherwise, you're going to be miserable for a large portion of your job, because a large portion of your job as CMO at a private equity backed company is managing the budget, and managing expectations around it and staying in sync with finance. And then whether or not so I would have liked a marketing playbook. Just because then at least I could deliver, like deliver what they expect, execute, etc. But if you're a more creative type that really likes to do their own thing and loves to be on the cutting edge, then private equity backed companies that tend to have playbooks, right, and Vista own companies, they're probably the most famous, you might want to avoid because they will cramp your style.

Brandi Starr  16:52

Okay, and that is, you know, that is a key consideration. Because you think about by the time someone gets to, you know, leading marketing, whether that's VP CMO, you have different career experiences, and some people are going to be stronger in some areas versus others. And like, that's really the, you know, beauty of the space is that you there's a lot of paths to get to the same outcome. But in considering what kind of companies you want to go to, that is that is really key. Um, something that you mentioned that I think, you know, whether you are private equity backed or not, that I think would be valuable is when you have a very financially minded leadership team, you know, whether it's a board or otherwise, any advice on really pushing forward those larger expenditures that may not have a clear line to how they're going to pay off like that,

Jenn Steele  17:55

when you raised that helps, hey, don't ask how many contracts that got signed right after our race?

Brandi Starr  18:03

Yeah, I guess, I guess timing is everything. And that means everything be prepared.

Jenn Steele  18:08

Yeah. If you can't directly tie things to results, tie them to pain. And know your audience, if you have tech founders, that you're working for tech, you know, tech leadership that you're working for, the pain is not going to be as sales driven as if you've had a go to market CEO, for example. So understand and play on that pain. If you can't tie it straight to revenue.

Brandi Starr  18:32

That's awesome. That's the I'm like, you know, I have not worked in PE backed, but I'm like, and I don't know that I ever will. But I'm like, Okay, this is a good, good note, because I know, you know, work with a variety of different clients, and some of my clients are smaller, and, you know, backed by private equity firms. And, you know, as I'm advising, you know, Head of Marketing, like, I'm like, in taking all of this for my own selfish benefit,

Jenn Steele  18:59

so different because you can take bigger bets when you're not private equity backed. And it's not that you can never take a big bet, but it's only probably with some of the more aggressive growth minded firms that you can do it, otherwise, they're going to be conservative finance people. Okay,

Brandi Starr  19:17

and that so that in considering which company you're going to understanding whether they are more, you know, as an hypergrowth, where they're a little bit more aggressive, versus, you know, more conservative in that. Yes. In what are the advantages? So, we've talked about some of the challenges. What, like, is there any, you know, someone is considering, you know, pe backed versus VC or a larger public organization? Like what's that, you know, what's that personality or that that thing that says like, Yeah, this is where I want to be.

Jenn Steele  19:58

I mean, advantages elite So as far as I'm concerned, and I'm sure that a lot of our colleagues can list out a bunch of different ones, they usually feel a bit more stable, right? You're not on the venture roller coaster of spend, spend spend, it's harder to fundraise than we thought and oh my gosh, we got to spend again, right? It's a, it's a little less, it jerked you around a little bit less, because honestly, you know, from the top line revenue, you know how much you're gonna have to spend, because you know that you're worshipping at the feet of EBIT da, right? You also know that you're gonna have an exit in five years, or, obviously less, because they're trying for a five year horizon. And so assuming that you get equity as part of your package, which as if your C suite, you probably do, you're gonna get some payback there more reliably than you will from venture. So those I think, are the two big ones, that could be considered advantages.

Brandi Starr  20:50

Okay. So it's almost like, choosing where you want to be is somewhat of an investment strategy, kind of, there's, you know, there's a bigger risk. And in that risk, it's almost, you know, sort of the pain and stress that you go through in the process. But there's also a bigger reward on the back ends are a


Jenn Steele  21:13

more reliable route. Yeah, there's probably a bigger venture reward, but also, I have a fair amount of useless stock from some of my previous venture backed companies. So So yeah, it's that it's that balance.

Brandi Starr  21:26

Okay. So let's talk a little bit about kind of the day to day of, you know, we know, we got to focus on being budget minded, and, you know, talking to the finance, people, you know, with a little a little bit of a French accent. But in terms of actually like getting things done, are there places where you see that private equity brings challenges that you don't see other places?

Jenn Steele  21:56

You'll never grow your team fast enough. And so you won't be making more trade offs. And if you like trade offs, I don't know who does, but, or if you like it, so for me, I actually treat the whole budget and trade offs thing, almost like a video game, right? So for me, there's at least a little bit of fun there. But you're not gonna grow as fast as you want. Like your budget is your budget, and you can shift things around. So you, yeah, it's all about the trade offs on the day to day. And so, for example, at a private equity backed company, I had a marketing team of five. And now I'm at a venture backed company of about the same time and I have a team of 12, there's a very big difference in what my team can do.

Brandi Starr  22:39

Yeah, I was having a chat, just kind of a virtual coffee was someone who connected with me on LinkedIn. And she's VP of Marketing for a PE backed firm. And she's a team of two. And so it's, it's her and it's one person that's more in a doer kind of role. And so just even hearing what you know, I mean, we're a small company, so I have my hands on a lot. But just hearing all the things that she kind of had her hands in, it was like, Whoa, like, when do you sleep?

Jenn Steele  23:12

And you hear your, you hear your venture backed colleagues and your public company colleagues talk about doing this, and that and this and that you're like, I'm barely surviving over here, like we chose, like one big initiative and like, that's all we can do.

Brandi Starr  23:27

And that is that is also key as well, because there is in those trade offs comes a little bit of volume in, you know, even if you've got the budget, do you have the resources and ability to actually execute.

Jenn Steele  23:43

And that's why the playbooks are nice, because at least then you've got something that they'll spend.

Brandi Starr  23:49

Right? Yeah. Cuz it's kind of vetted. Yes. Do you see where the same resourcing challenges exist in other areas of the business that then kind of bleed into marketing?

Jenn Steele  24:04

It depends on your business. Obviously, sometimes they've invested too much in OPS, sometimes they haven't invested enough. It's very strange to work at a company where you're the finance team is twice the size of the marketing team. And but there you have it, there's the folks that are more directly tied to revenue. Basically, sales and finance will tend not to have the resource constraints. And it can be that can be to your advantage if you're suddenly like, I think sales enablement should really live over in sales, and then you've got something covered that maybe Product Marketing used to cover.

Brandi Starr  24:37

Okay, so yeah, so it again, it is kind of those trade offs. Like, if you move sales enablement to sales, you kind of lose control over what's happening, but then you're also not accountable to that budget.

Jenn Steele  24:50

It's one less thing your tiny little team has to do and spend for

Brandi Starr  24:54

yes, but then you know, it's almost like the sales enablement in sales action. Really work effectively, which is, you know, debatable.

Jenn Steele  25:03

That's a, that's a completely different day.

Brandi Starr  25:05

Different battle for a different day. Okay, so any thing that I have not thought to ask about that you're like, if you're in a PE backed or considering a PE backed to you've got to know this.

Jenn Steele  25:22

It's really I said it upfront, it's budget, it's numbers, it's all about the numbers. And if you don't like the numbers, don't don't do it.

Brandi Starr  25:31

Okay. So that is that is the key advice. So talking about our change, you know, our challenges is the first step and nothing changes, if nothing changes. And so in traditional therapy, the therapist gives the client some homework, but at revenue rehab, I like to kind of flip that on its head. And I'm going to ask you to give us some homework. Because when you know better, you do better. And so I'd like you to kind of summarize your key takeaways, which I think you just hit on the key point, it's about the numbers focus on the budget.

Jenn Steele  26:04

Sorry, I jumped the gun there.

Brandi Starr  26:06

No, quite all right. But the other thing would be what is that one thing? Like we try, you know, so often there's, you know, conversations, and you have all these, like 50 steps of things to do and people are like, how do I get started? So if you are someone who is at a PE backed firm, and let's say not feeling good about how it's going, what's up, because I'm trying to narrow it a little bit, because I know there's a lot of directions. But what is kind of that one? Next thing? What is the first thing you can do to try and move in the right direction,

Jenn Steele  26:42

discover where your board members are coming from, and your CFO can probably help you.

Brandi Starr  26:47

Okay, so that's the, that's the key relationships. So if we want to, you know, invite the CFO to coffee or lunch or, you know, I'm assuming people are in person, which is kind of a weird thing right now. But, you know, build that relationship, if you don't already have it with the CFO to understand where the board is coming from.

Jenn Steele  27:09

Sometimes your CEO will help you with that. But your CFO look good, because it's all about the budget and the numbers. I like starting there.

Brandi Starr  27:18

Well, I have enjoyed our discussion today. But that's our time for today. So thank you so much for joining me. 

Jenn Steele  27:28

Thanks for having me. And thanks, everyone, for joining us today. I hope you have enjoyed the conversation with Jen. I can't believe that we are already at the end. But thanks, everyone for joining this week and see you next time.

Outro VO  27:46

You've been listening to revenue rehab with your host Brandi Starr. Your session is now over but the learning has just begun. join our mailing list and catch up on all our shows at revenue we have dot live. We're also on Twitter and Instagram at revenue Weaver. This concludes this week's session. We'll see you next week.

Jenn SteeleProfile Photo

Jenn Steele

VP of Marketing

Jenn Steele is the VP of Marketing at Reprise, a demo creation platform that helps companies sell their product with their product. An enthusiastic advocate for Product-Led Growth (PLG), she is excited to get the word out about how Reprise helps companies increase their conversion rate by 60%.

She’s a Seattle-based go-to-market enthusiast with more than 20 years of leadership experience at high-growth companies like HubSpot, Amazon, Bizible (now Marketo/Adobe), and Madison Logic. She holds a BS in Biology & Writing from the Massachusetts Institute of Technology and received her MBA from Simmons School of Management.

Jenn is passionate about furthering women in business and prioritizes creating an inclusive, supportive work environment. When she isn’t busy talking about PLG, defining new market categories, or driving revenue, she enjoys going for runs and drinking Oregon Pinot with her spouse—but not at the same time.