(not so) private equity

In 1975, Peter Cancro made a decision that would shock most parents: Abandon his plans to attend college & go deep in debt to buy one sandwich shop. Today -a half-century later- that choice just made him a multi-billionaire. 

Cancro later changed the outfit’s name to Jersey Mike's Subs and began franchising in the 1980s.

I had the chance to interview his partner John Hughes about Jersey Mike’s unique culture & how it helped them scale so rapidly (Here’s the video)

Jersey Mike’s announced today it is selling a majority stake to Private Equity firm Blackstone in a deal valuing the restaurant chain at $8 Billion.

That gives Cancro -who still owns 87% of the company- a net worth of $7 Billion and vaults him into the ranks of the world’s 500 richest people. That’s a lotta pickles.

After you-know-who, Jersey Mike’s is the second-largest sandwich chain with 3,000 locations. And they’re not alone. Subway sold to PE last year for $10 Billion, and Jimmy John's sold to PE in 2019.

So, Private Equity & hiring. Let’s talk about it…

In the fast-moving world of PE & VC, the integration and management of talent can make or break the value proposition of an acquired company. Just like crafting the perfect hoagie, each ingredient must be selected with care and precision.

Most of my recruiting practice is with PE & VC portfolio companies. Here are the most common hiring mistakes I see, any one of which can derail the potential of investor-backed firms 

Failing to align talent strategy with business strategy: Mismatched ingredients

Hiring without aligning with strategic goals is like adding peanut butter to an Italian hoagie. According to PwC, 83% of failed hires stem from a strategic misalignment. Leaders must marry recruitment strategies tightly with the firm’s objectives.

Hiring only for skills & experience instead of DNA-Match: Wrong sauce

Choosing the wrong cultural fit can disrupt your team like a bad sauce ruins a hoagie. Deloitte Insights shows that companies with strong cultural alignment are 12 times (!) more likely to succeed. So, screen for the candidate’s DNA, not just skills (Here’s how)

Inadequate onboarding: Loose wrap

A loosely wrapped hoagie falls apart—just like poorly onboarded talent. Gallup research shows that poor onboarding doubles the risk of employee turnover. Your Onboarding must weave new hires into the fabric of your company’s culture and expectations.

Ignoring internal talent: Missing the hidden pickles

The best ingredients might already be in your pantry. Overlooking internal talent for leadership roles is a grave oversight; LinkedIn reports that internal hires stay nearly twice as long. Whenever possible, promote from within to capitalize on familiar talent and foster loyalty. (And that means alot, coming from an outside recruiter.)

Rushing the hiring process: Hastily-made hoagie

A rushed hoagie is a recipe for dissatisfaction. CareerBuilder notes that hurried hiring increases turnover by 25% and financial losses up to 50% of the salary. Go slow. Take the time to assess your candidates thoroughly.

Not leveraging data: Old-fashioned recipe

Still sticking to outdated hiring methods? That's like using last week's bread. IBM’s Smarter Workforce Institute states that data-driven recruitment boosts efficiency and cuts costs. It’s time to “ketchup” and embrace analytics to refine your hiring process.

Undervaluing soft skills: Skimping on the mayo

Focusing solely on hard skills can leave a sandwich dry. 89% of hiring failures are due to poor soft skills. So, balance technical expertise with communication and teamwork capabilities.

Lousy candidate experience: Soggy bun

First impressions matter. A negative candidate experience can tarnish your company’s reputation and deter top talent. Ensure your recruitment process is respectful and communicative, just like you’d expect your hoagie bun to be fresh and inviting.

Ignoring competitive analysis: Not checking other menus

Not knowing what competitors offer can leave you with a less appetizing option. Being aware of how rivals attract and retain talent helps you stay competitive. Analyze and adapt based on industry standards to ensure you’re not left behind.

Mismanaging salary negotiations: Overstuffed hoagie

Over or under-stuffing a hoagie ruins the balance. Similarly, mishandling salary negotiations can lead to discontent or financial imprudence. Offer competitive but sustainable compensation packages that reflect both value and prudence.

Like assembling the ultimate hoagie, hiring a team of top-performers demands attention to detail, creativity, and a commitment to quality. Here’s some more ways to do that.

Make it yummy,

Jeff