Private equity helps companies grow. But what must not change?

The fund that comes in, cuts costs and sells on exists mostly in anecdote.
The numbers tell a very different story.

Take, as an example, 64 Italian deals closed between 2019 and 2024. Average revenues rose from €101 million to €163 million, EBITDA from €13.3 million to €25.9 million, and equity value from €76.6 million to €217.1 million. 71% of the value created came from operational levers: 57% from revenue growth, 14% from margin improvement (AIFI-BIP).

So the fund does not take away. If anything, it transforms: it changes the management, the governance, the reporting, the markets, the processes. And when a company is transformed, something can be lost without any balance sheet flagging it.

The deeper a transformation, the more important it is to know in advance which elements can be optimised and which, if touched, change the nature of what the fund has bought.

If a fund invested in your company tomorrow, could you say what is non-negotiable?

The question, then, is not whether the private equity fund should transform the company. It is whether, before doing so, it has defined what makes the company impossible to replicate.

Due diligence measures what already exists very well

Revenues, EBITDA, debt, working capital, management quality, customer concentration and production capacity are all, naturally, included in due diligence.

Anyone who has been through it knows: far harder to measure are elements such as desirability, distinctive codes, the relationship with a community, distribution scarcity, the founder’s role or the product’s ability to sustain a premium price.

This is generally why a Brand Audit proves relevant in an investment process: it helps make visible the assets and dependencies that would otherwise show up in the income statement only once they began to deteriorate.

The document often missing from the first 100 days plan

Funds usually work on the first 100 days: management, reporting, priorities, capital, efficiency. Strong brands would need a parallel document: the invariants.

Invariants are the components that can evolve without being eliminated. I define them as genuine decision-making boundaries, whose purpose is to make explicit what only fierce resistance would otherwise manage to preserve. 

Though often underestimated, they are fundamental. Well-known cases prove it, in which preserving one or more of these invariants completely changed a company’s fortunes. For the better.

Moncler: outside capital without separating the brand from its stewardship

When Eurazeo acquired 45% of Moncler in 2011, the deal valued the company at around €1.2 billion. Remo Ruffini remained chairman and a major shareholder, while Eurazeo secured a significant presence on the board (Eurazeo).

What I find interesting in this specific case is how the financial governance changed without removing from the system the person who had led the brand’s repositioning.

Capital was able to accelerate growth, distribution and market access without forcing Moncler to rebuild the brand’s decision-making centre from scratch.

Trussardi: when a turnaround has to reckon with what remains of the brand

QuattroR entered Trussardi in 2019 with a 60% stake, through a capital increase tied to a five-year relaunch plan (ANSA). The brand came to the deal after a period of severe financial difficulty.

In 2024 Trussardi was then acquired by Miroglio as part of a restructuring that included stores, the historical archive and licensing rights, keeping the brand as an independent entity (ANSA).

Here the lesson differs from Moncler. When a fund enters a weakened company, the real work is deciding which parts of the identity still merit capital, which need reinterpreting and which belong to a phase that can no longer be rebuilt.

Continuity is not always preservation. Not everything needs to be kept under a glass case. But without an explicit definition, a turnaround risks producing a series of repositionings rather than a trajectory.

Missoni: when financial results and cultural perception can diverge

The last case I will present is Missoni: useful precisely because it does not allow a simple reading.

FSI, which invested in 2018 and became controlling shareholder in 2026, reports that over the period revenue doubled to around €130 million, with operating profit expected at around €20 million (FSI). 

At the same time, however, the Financial Times reported on the debate over the brand’s transformation and on criticism that a more structured management approach may have diluted part of its family and creative identity (Financial Times).

A contradiction, it would seem. Yet, as often happens in these sectors, both readings can be true at once. A company can improve financially while the market debates whether its identity has become more or less distinct.

The kind of problem that financial KPIs alone cannot solve…

The fund should also measure what it does not want to lose

If a brand accounts for a significant share of the deal’s value, the indicators that safeguard it should enter governance alongside the financial ones.

This is the territory of Brand Governance: turning principles and identity into decision rights, criteria, thresholds and review points.

After all, if the brand exists only in marketing presentations, the industrial plan will prevail every time volume and identity come into tension. And that does not generate growth. It never can.

The real question is not how much we can change

Change is not in question. A fund comes in precisely because it wants to change something. Value itself comes from transformation, and the strong numbers that accompany many deals show this is not misguided.

The real question is which changes increase the value of the asset and which make it easier to replicate.

A more efficient, international and professionally managed organisation can be a better company. But if, in the process, it loses the characteristics its customers value, its talent or its relationship with buyers, value is created on one side and consumed on the other.

That is what governance is for: making this tension visible before the exit, while it is still possible to decide what to touch and what to leave alone.