I said something to CFO Brew last week that I want to expand on here, because the quote was tight and the reality is not. Reporters need three minutes of reading; operators need the version with the work in it.
The point was this: private equity hold periods are stretching well beyond the standard five-year roadmap. We see a growing number of unsold companies, and we see more of them sitting in their late sixth year, sometimes seventh, without being ready for a buyer. PitchBook’s second-quarter 2026 data shows sponsors holding their largest, highest-value assets off the market. CapitalPad’s June analysis put a cause to it: buyers turned more selective, and the exit market shrank faster than the portfolios did. The full CFO Brew piece is here.
None of that is a market-timing problem a sponsor waits out; it is an operating problem the company has to work through, and the person who feels the shift first is the portfolio company CFO.
1. Operational Value Creation Stopped Being a Differentiator
For most of the last decade, financial engineering carried the returns. Cheap capital, multiple expansion, and disciplined leverage did the heavy lifting, and operational improvement was the story you told the LPs on top of that.
That era closed, and while LP return expectations did not move, the mechanism for hitting them did. When you cannot exit on schedule and you cannot lean on multiple expansion, the return has to come from actual business performance. Operational value creation went from a differentiator that some funds talked about to an industry standard that every fund now needs.
This is where the CFO role changes shape. The controller function, closing the books, managing the audit, running the reporting cadence, still has to happen. But it stopped being the job. The job became reporting and deciding on investment around value that the business actually creates: unit economics, customer-level profitability, forecast discipline, and the data integrity that an exit narrative rests on. I wrote more about why this sits with RevOps and not just finance in this piece on EBITDA erosion.
2. A Longer Hold Means More Cycles To Defend
The instinct when a hold extends is to read it as breathing room, when it actually works the other way. A longer hold means more board cycles, more capital calls to defend, and more chances for the original thesis to drift away from what the business is actually doing.
Consider what happens across two extra years. The management team turns over in places, the market moves, and the competitive set that looked settled at acquisition reorders itself. Every quarter that passes is a quarter where the gap between the model and reality can widen without anyone flagging it, because the exit-year target still sits out on the horizon looking achievable.
The CFO has to hold a financial model that stays honest across a longer horizon. In practice that means rebuilding it around leading indicators and evidence gates rather than a single exit-year number. A model anchored to one distant target degrades without signaling it. A model built on leading indicators tells you in month four whether the thesis is holding, while you still have time to act on the answer.
3. The Structural Work a Normal Hold Never Lets You Do
Here is the part I find genuinely useful about a longer hold, and the part I pushed in the CFO Brew interview. The structural work that a compressed five-year timeline forces you to skip becomes possible when the clock stretches. Most CFOs treat the extra time as a holding pattern. The ones who use it well treat it as the window to build the things that only pay back over 12 to 18 months.
Three of those things matter more than the rest.
Build a customer-level P&L
Most portfolio companies do not have one. That single gap explains a surprising number of downstream failures. Without customer-level profitability, nobody in the building can tell you which accounts actually make money. You cannot price with intent, you cannot allocate service cost accurately, and you cannot defend a retention strategy, because all three decisions depend on data that does not exist yet.
Building it is a data and instrumentation project rather than a reporting task you hand to an analyst, and it touches the CRM, the billing system, the support platform, and the cost allocation model. It takes months, and a five-year hold rarely leaves room for it while a seven-year hold does.
Use the P&L religiously, starting with pricing
Once the customer-level P&L exists, the first place it earns its keep is pricing. The old buy-cycle move was a flat increase across the base, applied because the model called for it. That approach treats a profitable account and an unprofitable one identically, which means it overcharges the customers you want to keep and undercharges the ones draining margin.
The better move is segmented pricing based on service intensity. Customers who consume heavy support, custom work, and account management should carry pricing that reflects that cost. Customers who run light should see it too. You cannot execute this without the customer-level P&L, which is exactly why the two steps sit in sequence. I went deeper on the evidence test for pricing power in this Operator Memo.
Install the 12-to-18-month structural investments
Some investments do not pay back inside a normal hold, so they get cut. A longer hold changes the math and makes them the highest-value use of the extra time.
RevOps is the first, because a predictable forecast is a RevOps outcome rather than a spreadsheet outcome, and building the pipeline data, the stage definitions, and the reporting that make a forecast trustworthy takes a year of disciplined work. CRM adoption is the second, and it comes before any sales productivity initiative, because you cannot improve what the reps will not log. The third is the reporting infrastructure that lets a CFO walk into a board meeting with leading indicators instead of last quarter’s lagging numbers. Each of these compounds over time, none delivers in a single quarter, and all of them are what an exit narrative eventually stands on.
4. Why This Is a Data-Integrity Problem Before It Is a Finance Problem
The through-line across all three is data. Customer-level profitability is a data problem. Segmented pricing depends on that data being clean enough to act on. Leading-indicator reporting is a data problem that only looks like a finance problem.
This is the part CFOs underestimate. You can hire a sharp finance team and still walk into an exit with a shaky narrative, because the underlying systems never captured the data the narrative needs. When a buyer’s diligence team pulls the thread, the story unravels not because the business is weak but because the evidence was never instrumented. I have watched otherwise strong companies discount their own exit multiple because they could not substantiate the numbers they knew were true.
The longer hold is the chance to fix the instrumentation before a buyer tests it. That work belongs to the CFO now, in partnership with whoever owns RevOps and data, which is why I keep arguing the modern portfolio CFO needs an operating partner on the technical side. That is the specific gap DevriX closes for PE-backed companies.
5. What I Would Do in the First 90 Days of a Stretched Hold
If I took a portfolio company CFO seat today and learned the hold was extending, here is the sequence I would run.
First, I would establish whether a customer-level P&L exists in any form. If it does not, that becomes the anchor project, with a named owner and a data plan rather than a vague intention. Second, I would rebuild the forecast around three to five leading indicators the board can watch monthly, so the model reports drift early instead of at year-end. Third, I would audit pricing against service intensity and find the two or three segments where the current rate card is clearly wrong in either direction. Fourth, I would map which structural investments were cut for payback reasons and re-underwrite them against the longer timeline.
None of that is exotic, and all of it is the structural work that a compressed hold never permits. The extended hold is what finally creates room for that work, and the CFOs who use it that way protect an exit that the CFOs treating it as a waiting room will eventually struggle to reach.
The Author
Mario Peshev is a 5x CEO and operator, founder of DevriX and Growth Shuttle, global value creation advisor, and author of “MBA Disrupted.” He advises private equity sponsors and portfolio leadership on technical value creation, post-acquisition execution, and RevOps. Connect on LinkedIn.
