By Matt Page, Mathieu Rasamoela and Björn Schubert
Roland Berger's latest perspective outlines how sponsors can proactively drive value creation ahead of divestment through a structured, data-driven Exit-Ready Sprint. With market activity projected to ramp up by 2026, firms that prioritize readiness now—demonstrating real performance improvements and credible upside—will have a decisive advantage.
Private equity is facing a structural shift. With over half of portfolio companies held for four years or more, and sponsors increasingly turning to continuation vehicles, NAV loans, and dividend recaps, traditional exit timelines have stretched. This delay, however, hasn’t lessened the expectation for returns - only heightened the pressure to deliver them at exit.
With high interest rates, lower leverage than pre-2022 and relatively stable multiples, GPs need to work harder to make their deals work. Running the numbers through a generic model shows that portfolio companies need to achieve three CAGR points of EBITDA growth in order to achieve the same 20% IRR today compared to pre-2022.
As deal flow returns, likely by late 2025 or early 2026, the market will be crowded. Competitive differentiation won’t come from market timing alone. Buyers are increasingly sophisticated and demand evidence, including validated EBITDA improvements, proven management execution, and a clear roadmap for further upside.
A robust exit process can no longer rely on a refreshed TAM slide or generic vendor due diligence. What’s required is a substantiated Value Creation Plan (VCP) - one that clearly links management actions to financial outcomes and articulates a credible path forward for the next owner. The plan needs to be in motion with some elements of realization at the time of exit. It can't be a preliminary outline or theoretical roadmap without any initial execution. As a result, this preparation needs to happen 12 to 36 months before the exit process to show improvement in EBITDA baseline while also leaving future value creation opportunities for the next owner.
Exit readiness is a structured effort to position a portfolio company for value realization, typically occurring 12 to 36 months before divestment. It goes beyond clean-up efforts and focuses on enhancing real, measurable performance. Importantly, it balances current execution with future opportunity—maximizing value while leaving a clear story for the buyer.
To meet this need, Roland Berger offers a rapid 2–4 week exit readiness sprint. It delivers clarity, prioritization, and a practical roadmap. The process begins with a diagnostic of commercial and operational performance, benchmarking internal metrics against competitors and surfacing gaps with the highest potential impact. From there, we define and quantify specific initiatives—spanning revenue acceleration, cost improvement, and organic or inorganic growth. These are not conceptual; data, timelines, each, and a clear rationale that fosters buyer confidence. The sprint concludes with an implementation roadmap, aligned with funding and management experience, that formalizes priorities and ensures readiness for buyer scrutiny.
With 2025 expected to remain transitional and 2026 shaping up for more vigorous activity, private equity firms that invest in readiness now will be best positioned to lead the way. Traditional exit strategies will require more preparation than ever before.
In this environment, exit value must be engineered, not assumed. Roland Berger equips sponsors with the structure, insight, and execution plan needed to ensure portfolio companies exit strong, clear, and differentiated.
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