Value creation plans should not be wishlists

The hard truth today in private equity is that many value creation plans (VCPs) are nothing more than glorified wish lists.

I just reviewed three VCPs last week for companies ranging from $50M to $250M in top line revenue. All of them failed on the exact same four fundamental points.

It’s not just about the idea of value creation. Everyone agrees this step is critical. But as most areas in sales pitches, what lacks is execution.

Understanding that every basis point of EBITDA counts, particularly as interest rates stay high and acquisition targets demand higher multiples, a VCP that doesn't translate directly into P&L impact isn't just suboptimal, but a liability. We're seeing more scrutiny than ever on how these plans actually deliver, not just look good on paper.

The aspiration vs. action gap

The first common failure we see in business is the elephant in the room:

Aspiration without clear action.

Most VCPs are packed with initiatives like "optimize customer lifecycle" or "enhance product-market fit."

Great, but what does that mean?

At a strategic meeting in Q3, I was asked to plug “customer lifecycle” into a specific annual roadmap as a required asset for the business roadmap. This is not a fairy tale.

I saw one that listed "Improve client retention" as a core pillar. No specific projects, no budget, no owner, no timeline. It's like saying "make more money" without selling anything.

You need to break each aspiration into specific, measurable projects. Instead of "optimize customer lifecycle," think: "Implement Gong for sales discovery analysis by Q3" or "Launch a 'win-back' campaign for churned customers with a 90-day pilot." These are things you can do, budget for, and track.

The missing "Who" and "When"

Next up, the glaring omission of assigned ownership and realistic timelines.

Every single initiative, down to the smallest task, needs a named individual responsible for its completion and a clear deadline. Without this, your VCP becomes everyone's problem and thus, no one's. You can't hold a department accountable; you hold a person.

I recently pushed a portfolio company to assign a VP of Revenue Operations as the owner for six specific VCP initiatives related to sales process efficiency. We set a 120-day sprint goal for an initial impact. Before that, it was just "Sales Leadership's responsibility," which meant everyone pointed fingers. This clarity drives performance.

For my private strategic circle group (focused on small startups and professional services), I provide a Drive folder with templates - one of them a classical RACI matrix for key roles and responsibilities. Assigning clarity in that direction is shaping job roles and avoids conflicts or dropping the ball in practice.

Undefined success metrics

How do you know if you're actually creating value?

Most VCPs fall short on defining success. They'll state a nebulous goal like "increase operational efficiency." But by how much? And over what timeframe? What's the baseline? This makes tracking progress impossible and celebrates activity over actual results.

Every initiative needs clearly defined, measurable KPIs. If an initiative is "renegotiate vendor contracts," the metric isn't just "contracts renegotiated." It's "$X saved annually" or "Y% reduction in supplier costs." For "improve lead-to-opportunity conversion," it's "from 15% to 22% in 6 months," directly tied to an expected revenue increase.

After over a decade in engineering and B2B professional services, we shifted into GTM solutions at DevriX and moved entirely into revenue operations over a year ago for similar reasons. Implementation complexity was going down (when speeding up with agentic systems). Strategic direction was in demand. And bridging the gaps between “problems” and “solutions” is an area that’s in high demand over the past year, opening up more and more demand from private equity portfolio companies and mid-market clients.

No financial impact modeling

Finally, and perhaps most critically for PE, is the absence of a financial impact model. You can have the best initiatives, owners, and metrics, but if you can't forecast the EBITDA contribution, it's just a business plan, not a value creation plan. Each initiative needs an estimated cost and an estimated return.

I insist on a waterfall model for VCPs.

• Project A costs $50k, generates $200k ARR.

• Project B costs $120k, saves $300k in opex.

You need to see the cumulative EBITDA impact quarter by quarter. This isn't just for investors; it helps management prioritize what truly moves the needle. A project that improves employee satisfaction might be great, but if it doesn't have a clear, quantified link to revenue or cost savings, it belongs in a different strategic plan.

Your VCP isn't done until you've assigned measurable goals and owners for each initiative, and modeled its direct financial impact on the P&L. Spend this week auditing your existing VCPs through this lens. If you can't tie every line item to an owner, a metric, and a dollar figure, it's time to refine it.

What do you see in the world of private equity and M&A deals? Reply to connect and dive into key background stories.

Mario

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Working with me

🌐 Scaling $30M - $100M+ mid-market companies with value creation through RevOps, data engineering, and WordPress. DevriX provides full RevOps consulting + delivery with GTM enablement for PE-backed portfolio companies, traditional tech, healthcare, finance, and professional service businesses pacing toward revenue growth initiatives. Our standard retainers between $10K and $60K include revenue lifecycle services for marketing and sales leaders, FP&A for financial teams, pipeline enrichment through websites and dozens of lead sources, automations and delivery integrations, CRO and ongoing testing, product delivery and platform integration solutions, and more through our consulting solutions.

🚀 1:1 Consulting. At Growth Shuttle, I run two popular plans: Async Advisory ($3,500/mo) for $3M - $30M founders and executive teams and the smaller Strategic Growth Circle ($997/mo) for $100K - $500K entrepreneurs, agency founders, scale ups. My fractional executive plan is also available here.

📈 Building US LLCs from Europe. I help European and Asian founders scale faster through doola and their “Business in a Box” model. Also suitable for US citizens (given their bookkeeping solution), but in very high demand across Europe.

📊 Post-Merger Integration. We take on M&A initiatives with Flippa. Working closely on PMI retainers for PE companies and fast-growing startups integrating new companies within their portfolios, enabling data pipelines, and securing more deals through my personal network.