What Holds #1 – Private equity and the question behind the exit problem
​
There’s a growing tension in private equity that’s starting to become harder to ignore.

Firms are currently sitting on an estimated $3.8 trillion in unsold assets, with holding periods stretching well beyond what used to be typical. The usual explanations point to macro conditions – interest rates, valuation gaps, timing.

All of that is true.

But it doesn’t fully explain what’s happening.

When you look a bit closer you start noticing a common pattern. It’s something I’ve come across repeatedly in practice, and one that I’ve been paying closer attention to recently. Many of these businesses have been pushed to perform, but not always to fully integrate or mature as organisations.

Value creation has often been driven by:
– accelerating growth, 
– tightening operational efficiency,
– pursuing integration at speed.

None of this is unusual. It’s how the model works.

But it does raise a question: What happens when financial performance moves faster than the organisation’s ability to hold it?

That creates a gap where the business looks strong… on paper. But it can feel less resolved structurally, culturally, and in how decisions actually land across the organisation.

Over time, that creates something difficult to name: a company that performs well, but isn’t fully built.

And that tends to show up at the worst possible moment – when the intention is to sell.

At that point, what looks like a major market issue is often something else. The question is no longer just whether the numbers are right, but whether the organisation behind them is actually complete.



Joanna Stone works with PE firms and portfolio companies on the human architecture of change. 



Thoughts on this? I'd love to hear them. Join the conversation on LinkedIn