Why PE Firms Are Recruiting More Corporate Leaders

The number of US private-equity-owned businesses has surged more than 400% over the past quarter-century, while the pool of listed companies has shrunk by roughly 35%, according to Citizens Bank. That mismatch has forced a rethink in how PE firms fill the top job. Five years ago the default was to hire someone who had already been a portfolio-company CEO. Today, as fresh research from leadership advisory firm ghSmart makes clear, the playbook has changed.

In 2024 and 2025 alone, 53% of first-time PE-backed CEOs assessed by ghSmart came directly from corporate C-suite or business-unit leadership roles, upending the old assumption that only repeat CEOs could handle the pressure. The trend is driven by bolder value-creation plans, more complex transformations, and a genuine shortage of experienced portfolio leaders.

Yet the leap is far from automatic. Analysing assessments of 491 senior executives—241 portfolio-company CEOs and 250 corporate C-suite leaders—ghSmart pinpointed five capabilities that consistently separate those who succeed from those who stall. The findings, backed by interviews with CEOs and investors at firms such as Warburg Pincus and Integral Ad Science, offer a clear blueprint for what it truly takes to lead in PE.

The Five Capabilities That Distinguish Successful PE-Backed CEOs

Practical Commercial Orientation

PE-backed CEOs were 17% more likely than corporate peers to excel on the commercial side of the business—pulling revenue levers rather than just managing budgets. “The biggest adjustment is trusting that it really is all about the value-creation plan,” said two-time portfolio CEO Robert Hanson. The clock starts on day one; leaders must quickly identify what moves the needle and redirect the firm as data rolls in, without waiting for annual planning cycles.

Strategic Thinking Under Pressure

The research found that PE CEOs were 20% more likely to make strategic thinking a top priority. Without quarterly earnings constraints or the need for broad consensus, the mandate shifts from planning to rapid implementation. “You make a decision, and the next meeting is about how you’re implementing it,” observed Jesper Nordengaard, a first-time PE CEO who previously led Colgate-Palmolive’s North American business.

Wielding Influence from Day One

Corporate hierarchies and established relationships offer little shelter in a PE setting. New CEOs must earn the trust of fresh boards, investors, and lean teams quickly. They do so by spending significant time in the field, working one-on-one with leaders, and pushing accountability down the organization. Eric Jungbluth, a serial PE CEO with three public-company roles behind him, said success hinges on “how well you drive execution through others.”

Calculated Risk-Taking

Portfolio-company CEOs scored 12% higher on risk-taking than their corporate counterparts. In practice, that shows up in staffing: while a corporate giant might take months to vet a senior hire, a PE-backed firm demands near-instant calls on who can deliver for the next two years. “In private equity you’re hiring for where the business needs to be two years from now, not where it is today,” said Maggie van de Griend, managing director at Warburg Pincus.

Interpersonal Range

Perhaps the starkest contrast is the move from formal, episodic board interactions to daily, unscripted conversations. Greg Gartland, CEO of 3E, recalled that at S&P Global he attended board meetings only for narrow topics. “In PE, I’m on the phone with the board every day,” he said. That shift demands candor, the ability to read people’s motivations, and a willingness to adapt one’s style to galvanize teams and resolve conflict without the safety net of a corporate structure.

The overarching insight from the research is that prior PE experience, while still valuable, is not the decisive factor. Instead, measuring a leader against these five capabilities—commercial instinct, strategic agility, influence, risk tolerance, and interpersonal range—offers a far more reliable way for both firms and candidates to gauge fit.

What Corporate Leaders Should Know Before Making the Leap

For Executives Considering the Leap

  • Pressure-test your commercial reflexes. If you’ve spent most of your career in staff roles that are several steps removed from revenue, ask yourself whether you’re ready to own a value-creation plan and adjust it monthly based on incoming data—as the 17% performance gap suggests, this is a decisive area.
  • Examine your staffing speed. A PE-backed CEO must make hires without perfect information; the research shows a 12% greater appetite for risk among successful CEOs. Consider if you’ve demonstrated fast, outcome-driven people decisions in a corporate turnaround or disruptive assignment.
  • Assess your boardroom familiarity. If your board interactions have been formal and filtered, the need for daily, candid dialogue may be a shock. Seek opportunities—even within your current firm—to engage directly, informally, and frequently with directors or senior investors.

For Private Equity Firms

  • Rethink the hiring playbook. The data shows a ready pipeline of corporate leaders, but the ones who succeed are those who can wield influence broadly, tolerate ambiguity, and talk the language of value creation—not simply those who have done it before. Tailor your assessments to these five traits rather than defaulting to “previous PE CEO” as a proxy.