Long-term of any private equity fund today is the next ‘quarterly result’, mentioned a senior and seasoned private equity player while chatting with me on Sunday evening. Here’s the gist of our conversation:
Private equity plays a huge role in shaping companies — not just by providing capital, but also through strategic advice and valuable insights. But the real question is: are fund managers truly thinking about the long-term success of the businesses they invest in, or are they simply chasing quick wins?
Unfortunately, it seems that many are too focused on short-term gains. The obsession with quarterly performance can distort priorities, especially for smaller companies that are still trying to stabilize and grow.
To build anything meaningful and lasting, we need to focus on the bigger picture. It’s not just about turning a quick profit — it’s about creating sustainable growth over time. While it’s true that private equity firms operate with exit timelines, they could significantly increase their impact by investing in building strong management teams, sharing deep industry insights, and fostering meaningful networks.
It’s time for private equity to evolve — to use its vast resources not just for financial engineering, but for helping companies grow steadily, with purpose. The focus must shift from short-term wins to long-term value creation. When that happens, both businesses and investors benefit.
Indian promoters understand this dilemma all too well. Sometimes, their hesitation to engage with private equity stems from these very concerns. But staying away doesn’t help either. What we need is greater trust, transparency, and alignment between promoters and private equity players.
Only through mutual understanding and collaboration can we unlock the true potential of sustainable growth, innovation, and long-term success in the Indian business ecosystem. The time to align goals and strategies—for the benefit of all stakeholders—is now.