What does the CXO Program offer?
The program offers the chance to run a business early and participate materially in the value created. This is a type of ETA model and an emerging alternative to the traditional search fund.
What work do participants do?
Initially, participants work inside an operating business or the holding company on live priorities. The work may involve customers, cash, trading performance, operating improvement, acquisition assessment and transition. Depending on the impact and results, participants may get the opportunity to transition to the CEO role of a subsequent acquisition.
How does selection and progression work?
The first stage is the selection. Responsibility increases as judgement and performance are demonstrated. The intended destination is then CEO of a new acquisition. That progression journey should take no more than 24 months. Appointments and timing depend on performance and the needs of the group.
How do the economics work?
Once the candidate has progressed to the CEO role, the longer-term reward is linked to the value created in the business the participant ultimately runs, subject to an investment hurdle and paid over time. Meaningful upside begins above the agreed return on capital.
The program suits people willing to accept accountability, uncertainty and at-risk economics for the opportunity to run a business and share in what it becomes.
What is the size of the prize?
Participants placed into the CEO role of a new acquisition take part in an equity-linked incentive programme that pays against a hurdle measured as a multiple of the capital invested. The share of equity depends on the business and on how the acquisition is sourced and funded.
The hurdles follow the same annualised return structure used in a traditional search fund. The Stanford and IESE primers on search funds set that structure out in detail, including the quantum of the upside.
Who is the CXO Program for?
The standard is deliberately high. We are looking for A-players who could succeed on a conventional professional path but want responsibility for building and running a business earlier in their careers.
Typical candidates may come from management consulting, leading MBA programs, investment banking or private equity, military leadership, high-growth companies or demanding operating roles. Selection is based on evidence of analytical ability, pace, judgement, humility and personal ownership of results.