Like many buyout shops, Alpine Investors recently welcomed its latest class of freshmen analysts–about a half a dozen this year, all previously interns–recruited from top schools around the country.
But, in an unusual move, the San Francisco-based firm also welcomed a second class of recruits. As part of a four-year-old “CEO-in-training” program, the firm over the past year tapped a dozen second-year MBAs from top business schools to join portfolio companies in senior operating roles after graduation.
In August these recruits began two weeks of private-equity training and networking; some immediately deployed into operating roles, while others joined investment teams at Alpine Investors with the aim of finding an operating role later on. They all receive ongoing mentoring and leadership training.
The program is the brainchild of Partner and Founder Graham Weaver, who in addition to leading the firm moonlights as a lecturer in management at the Stanford Graduate School of Business.
According to Jacob Balley (pictured), who leads the program as head of talent management at Alpine Investors, Weaver in his dual academic/business roles observed certain characteristics shared by both top students in his classes and top CEOs in his portfolio companies. Chief among them, they demonstrated humility, they sought to learn everything in sight, and they had an unquenchable will to win.
Weaver suspected that young adults who combined these three characteristics with successful track records could side-step plodding, rung-by-rung climbs up the career ladder to advance to CEO roles much earlier than is typical.
Thus was formalized, in 2015, the CEO-in-training program, whose goal is to place post-MBAs in C-suite and other executive roles at portfolio companies and have them quickly advance to CEO positions, either at the platform or subsidiary level.
Of the three to four dozen people who have gone through the program, eight have reached “ambassador” status, meaning they’ve either led a company through an exit as CEO or they’ve become a chief executive who manages other CEO-in-training executives. All told,18 participants in the program serve as CEOs today; two-thirds of those became chief executives within their first year in the program.
“Graham always says that we’re in the talent business not the private equity business,” said Balley. Get the right people in the right positions at portfolio companies, he added, and everything else falls into place.
Another feature of the CEO-in-training program: Alpine Investors doesn’t care if candidates built their track records as members of the military, as professional athletes, as founders of a start-up company, as private equity analysts, or in other fields. By being agnostic on experience, Alpine Investors ends up with an especially diverse set of executives at its portfolio companies.
“Today, 42 percent of the [CEOs-in-training] are women,” said Balley. “We’re striving for 50 percent. I’m comfortable we’ll be able to get there.”
Alpine Investors backs software, healthcare and other services companies with recurring revenue models that generate EBITDA of $1 million to $30 million. The 18-year-old firm closed its sixth fund at $532 million in mid-2017.
Interested in learning more? Email Jacob Balley.