Joe Gravino, VP of GTM Search at Falcon, brings expert insight into hiring the right revenue leaders for private equity-backed companies. With a mission to build better teams that drive returns, Joe and his team at Falcon have helped 250+ portfolio companies and 50+ PE firms find the best-fit CROs, CFOs, and VPs of Sales.
In this episode, Joe shares his knowledge on avoiding costly mis-hires. He breaks down the most important traits to look for, the right questions to ask, and the pitfalls to avoid when bringing on a new CRO or VP of Sales. His practical advice is a must-listen for any founder or investor looking to nail their next crucial revenue hire.
Catch the full episode with Joe right here:
I took some time to break down 5 of my favorite lessons from our conversation below:
One of the most frequent mistakes PE firms make is rushing to bring in a CRO for an early-stage, founder-led company. As Joe explains:
"CROs in these organizations often get stuck because they come in thinking they need to put in a grand strategy. In reality, PE firms make more risk-adjusted bets on these businesses using debt, leaving less cash to operate with."
In other words, a highly strategic CRO accustomed to ample resources may struggle in a scrappy, early-stage environment. It's crucial to align the leader's skills and expectations with the company's current growth stage and available resources.
Instead of defaulting to a CRO, Joe recommends a different approach for early-stage companies:
"I'd much rather see an organization take the CRO budget, break it in half, and hire a strong VP of Sales and VP of Marketing. They go build their domains the right way, and that's how growth happens at these stages."
A VP of Sales can focus on building the team and driving frontline effectiveness, while a VP of Marketing can lay the foundation for demand generation and brand awareness. Together, they can create the infrastructure and momentum needed for a CRO to step in and scale later. This divide-and-conquer approach allows for more focused execution in the critical early stages.
When evaluating potential hires, Joe emphasizes the importance of looking at a candidate's track record of driving growth:
"I look at whether they've been in situations where they've outperformed their market and been with growing companies. What specifically did they do to enable that growth?"
Past performance in similar contexts is a strong predictor of future success. Don't just settle for high-level claims of achievement; dig into the specifics of how candidates have driven results, expanded market share, and navigated challenges in their previous roles. Look for concrete examples and metrics that demonstrate their ability to impact the bottom line.
While domain expertise can be valuable, Joe cautions against overemphasizing industry experience and existing relationships in the hiring process:
"I've seen it time and time again where they've hired that person, and then nine months later, they come back to us and say, 'They were really good for the first three months when they had existing relationships, but when the pipeline dried up and the team was not built correctly, things fell apart.'"
Relationships can open doors, but they aren't sufficient for sustained success. A rolodex is only valuable if the leader also has the skills to build a high-performing team, implement scalable processes, and adapt to new challenges. Prioritize candidates with transferable skills and a proven track record of success across multiple contexts.
The ideal revenue leader for a PE-backed company is one who can think strategically but also roll up their sleeves and get things done. As Joe puts it:
"We are always looking for people with a white-collar brain who can add value at the board level but also have a blue-collar work ethic. They need to tactically execute in an under-resourced environment."
In the middle-market PE space, leaders must be adaptable, hands-on, and comfortable wearing multiple hats. They need to be able to zoom out to set strategy and zoom in to guide execution. Look for candidates who have demonstrated this versatility in their past roles and can articulate how they would apply it to the specific challenges and opportunities of your portfolio company.
.svg)
