From CFO to Private Equity Operating Partner

For CFOs who have worked in private equity-backed businesses, there is another career path that is becoming more common: the operating partner.

An operating partner works with or for a private equity firm, helping its portfolio companies improve performance. Instead of running finance for one business, you advise or support several. You may sit on boards, lead projects, help hire CFOs and work on deals.

For CFOs with a strong record in PE-backed businesses, especially those who have been through a successful exit, it can be a natural next step.

This article covers what the role involves, what PE firms look for, how to build the record and whether it is right for you.

What an operating partner does

The title and structure vary between firms. Common versions include:

• Full-time operating partner. Employed by the PE firm, working across several portfolio companies.

• Operating adviser. Part-time or project-based, often alongside other roles.

• Executive chair or board member. Sitting on portfolio company boards on behalf of the firm.

• Functional specialist. Focused on one area, such as finance, procurement or technology, across the portfolio.

Typical work includes:

• Reviewing new investments before purchase

• Building value creation plans

• Supporting portfolio company CFOs and CEOs

• Leading improvement projects in finance, cost, pricing or working capital

• Hiring senior executives for portfolio companies

• Preparing businesses for sale

For a CFO, this often means applying what you have done in one business across many.

What PE firms look for

PE firms typically look for operating partners who:

• Have created measurable value in PE-backed businesses

• Have been through at least one exit, ideally a successful one

• Understand how PE firms make money

• Can work at pace and with limited resources

• Can influence CEOs and CFOs without direct authority

• Bring a strong network of executives

The exit record matters. PE firms want to see that you helped a business grow in value and then supported a sale.

Building the track record while still a CFO

If this path interests you, start building your record now.

Work in PE-backed businesses. Most operating partners have been CFOs or CEOs in PE-owned companies.

Deliver measurable value. Show results in EBITDA, cash, margin and growth. PE firms think in these terms.

Go through an exit. Lead finance through a sale. Show the outcome.

Build relationships with PE firms. Get to know the investment teams at your owner and at other firms.

Help other CFOs. Mentor or advise CFOs in other businesses. It shows you can help without running the business yourself.

Results that land:

• "Grew EBITDA from $18 million to $34 million over four years in a PE-backed business, supporting a sale at 2.6 times the entry value."

• "Released $22 million in working capital in the first year of PE ownership."

• "Led finance through two sale processes and one secondary buyout."

For more on PE roles, see private equity-backed executive roles and private equity versus listed CFO roles.

How these roles are found

Operating partner roles are rarely advertised. They are usually filled through:

• Relationships with PE firms you have worked with

• Recommendations from PE investment teams

• Specialist search firms

• Your network of executives and advisers

That means relationships are everything. If you want this path, stay in touch with the PE investors you have worked with. Let them know your interest well before you are ready.

How pay and equity usually work

Arrangements vary widely between firms and roles. In general terms, operating partners may receive:

• A base salary or retainer

• Fees for board or project work

• A share of fund performance, sometimes called carried interest

• The chance to co-invest in deals

The details depend on the firm and your role. Take independent advice before agreeing to any equity or carried interest arrangement. Do not assume figures you hear informally apply to you.

Is it right for you?

The role suits CFOs who:

• Enjoy variety and working across many businesses

• Like advising and influencing as much as running

• Think in terms of value creation and exits

• Are comfortable with less day-to-day control

• Have strong relationships with PE firms

It may suit you less if you:

• Prefer leading a team and owning a business

• Want a clear, stable structure

• Do not enjoy the pace and pressure of PE timelines

Some people try it and return to CFO or CEO roles. That is fine. Operating partner experience can make you a stronger executive later.

Positioning your resume

If you want an operating partner role, your resume should lead with value creation.

Profile: "CFO with a record of value creation in PE-backed businesses, including two successful exits. Grew EBITDA from $18 million to $34 million, released $22 million in working capital and led finance through two sale processes. Seeking an operating partner role."

Achievements: Lead with EBITDA growth, cash, exits and value creation. Show results across more than one business if you can.

Interview preparation

PE firms will test your ability to create value quickly. Expect questions such as:

• Walk us through how you created value in your last business.

• What would you look at first in a new portfolio company?

• How would you work with a CEO who resists your recommendations?

• Tell us about an exit you led. What drove the value?

• What is your network of CFOs and CEOs like?

Prepare specific stories with numbers.

Common mistakes

• Approaching PE firms without a clear value creation record

• Underestimating how much relationships matter

• Assuming the role is like being a CFO across many businesses

• Accepting equity arrangements without advice

Starting part time

Many people start as an operating adviser on a part-time or project basis, sometimes alongside a portfolio career. It is a lower-risk way to test the role and build relationships with a firm. See executive portfolio careers.

What the first year looks like

The first year as an operating partner can feel very different from being a CFO. You may move between several businesses each week, each with its own leaders, problems and culture. You will have less control and more influence. Some CEOs will welcome you. Others will see you as the owner's representative and be cautious.

The best operating partners build trust quickly. They listen first, focus on a few clear priorities and make the portfolio company's leaders look good. If you have done this before, as a CFO working with PE owners, show it in your examples.

Where to start

Start by listing every PE firm you have worked with or met. Note the people you know at each one. Then reach out, not to ask for a job, but to share your interest in operating roles and ask how they use operating partners. Many conversations like this lead to project work first.

A quick self-check

Ask yourself: could you name the value you created in each PE business in one sentence, with a number? If not, work that out first. It is the core of every operating partner conversation.

Common questions from CFOs

Do I need to have been a CEO? No. Many operating partners were CFOs. Do I need a large network? It helps a great deal. Do I need to invest my own money? Sometimes, through co-investment, but take advice first.

Your next step

Write down the value you created in each PE-backed business you have worked in. EBITDA, cash, margin and the exit outcome. If the story is strong, start conversations with the PE firms you know.

If you want help positioning yourself for an operating partner role, my CFO resume writing covers CFOs moving into PE and advisory work.

If you are weighing this path, book a complimentary Clarity Session.