What is the most efficient way that PE firms grow their portfolio companies by multiples? I doubt it can be realistically achieved through aggressive growth strategies / operational improvement... How realistic is a 4-5x target in a 5-10 yr timeframe if even the most aggressive (non-nascent) companies grow less than 20% annually. What happens where scaling via buyouts is not very feasible (i.e. in an emerging industry where there aren’t many companies to buy)? Are most PE firms basically betting on another larger company buying their portfolio company, or on an IPO? What other non-acquisition-or-sale/non-IPO strategies do PE firms use to achieve growth in multiples?
Newbie here- apologies if this question has already been answered or the answer seems obvious…