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A powerful tech strategy is the key to breakthrough transformation. For portfolio companies, a rightsized roadmap not only accelerates value but can also lead to superior exit multiples.
Combining business and technology strategies can unlock significant value through cost savings and growth. Although they are often viewed separately, an integrated technology strategy can efficiently streamline operations and drive business expansion with a strong return on investment. In private equity, aligning IT capabilities with the deal thesis and business strategy accelerates the financial impact while also creating lasting value and optimal returns.
1-2x EBITDA premium
The increase portfolio companies that executed against a clear technology strategy aligned to business goals received upon exit
Portfolio companies seek support from the EY Private Equity practice in three key areas. Any of these areas can provide an entry point into value creation realization and can be done throughout the hold period. Starting with the priority that aligns to your growth plan, and giving consideration to an enterprise-wide perspective, can create a roadmap that accelerates the value creation plan.
1. Technology strategy:
A tech strategy aligned with the deal thesis focuses investments to enhance operational excellence, drive strategic growth and achieve optimal EBITDA exit multiples.
2. Enterprise resource planning (ERP) modernization:
An ERP platform is vital for portfolio company value realization, optimizing the investment returns with an integrated, scalable framework that enhances business efficiency and supports data-driven decision-making.
3. Artificial intelligence (AI) enablement:
AI is rapidly transforming portfolio companies by driving unprecedented innovation and operational efficiency, turning them into high-value, future-ready assets.
When done with forethought, portfolio companies can leverage technology transformation costs efficiently and use time effectively as a benefit to the business to minimize disruption. That’s the difference between investing in technology and building a technology roadmap.
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