Let's Connect: Why Private Equity Leaders Need to Build Their Presence on LinkedIn

In recent years, many top private equity firms have stepped up their social media programs, utilizing LinkedIn as a targeted and effective mechanism to connect and become top of mind with investors, entrepreneurs, employees and portfolio companies, among other core stakeholders. A more modern online presence can pay dividends as borne out in research we recently conducted , which revealed that an active company LinkedIn profile with relevant and engaging content can have a positive reputational impact, as company LinkedIn pages typically rank in the top 10 in Authority Scores on search engines.

An Authority Score is a calculation using machine learning to evaluate each domain’s quality, popularity and backlink signals, which measure the number of links from one website on a page to another, to determine which websites are most accurate and trustworthy. Having a high Authority Score allows Google to rank your site higher in search results, helping increase your reach.

Given the reputational benefits that many well-known private equity firms have recognized from building up a LinkedIn presence, it’s surprising that the leaders of those firms often aren’t active on LinkedIn or don’t yet have an optimized and discoverable profile.

Fewer than half of the CEOs or managing partners from the top 20 private equity firms post more than once a month on LinkedIn (a rate we regard as the bare minimum). In fact, there are several who have no LinkedIn profile at all. This is a missed opportunity, as leadership teams at private equity firms can use the platform to enhance their public profile, reinforce their firm’s distinct investment strategies and business goals and tell their story in ways no one else can.

While managing a social media channel might seem daunting for a busy senior executive, there are plenty of reasons to get started now – even if the initial foray is small, you can build upon it gradually and scale up later. Here are five key reasons why private equity leaders should put more effort into their LinkedIn presence.

1.  Assist with deal sourcing: When it comes to selling potential deal sources on a firm’s investment approach, values and success stories, there’s no better voice than that of leadership. LinkedIn allows executives to articulate their unique investment and value-creation philosophies and approaches, while highlighting investment successes across the portfolio. In most cases, the executive voice paired with the private equity firm’s LinkedIn channel can speak to different audiences by sector and industry, increasing the likelihood of deeper resonance and conversation with key constituents. The payoff will first come in social currency as it’s common to see private equity executives’ posts receive likes, shares and comments from top limited partners or prominent company executives in target sectors, and then it could pay off in connections and leads.

2. Protect against criticism: When preparing to acquire a company, executives may not know who their critics are or what they have to say until the announcement goes public. They can preempt potential criticism by regularly sharing content that highlights the firm’s core values and competencies, taking the wind out of critics’ sails even before a transaction announcement press release crosses the wire. Social content can help best position executives and their firms as thoughtful and consistent in their approach to investments and value creation.

3. Tell your own stories: By being active on LinkedIn, executives can own and control stories that promote their successes rather than relying solely on traditional print and broadcast media, where firm announcements may be drowned out or lumped in with other developments, depending on the day’s news cycle, or where the narrative is potentially misunderstood. By posting firm news on their own LinkedIn channels, executives can cut through crowded spaces, convey the messages they deem most important and speak directly to both internal and external stakeholders.

4. Recruit top talent: In the war for talent, LinkedIn can be a potent weapon. Prospective hires are likely to use the site as a resource to learn more about a firm and its values. Given firm values and culture start at the top, it’s critical that executives are present and active storytellers to potential and current employees. Many notable CEOs post about their firm’s commitment to DE&I, talent development and fostering a positive company culture. Additionally, they comment on employees’ posts about promotions or their experiences at their companies. Such engagement can help boost employee morale while signaling to prospects that leadership is engaged with and attuned to the needs of their employees.

5. Rise above as a thought leader: Discussing industry-specific insights as well as macroeconomic trends can help demonstrate an executive’s expertise and attract the attention of key industry players, potential business partners and reporters. We have seen success from executives who use LinkedIn to highlight personal passions, from important philanthropic causes to their favorite sports team. Showcasing both their professional expertise and a touch of the personal will credential and drive engagement for leaders who also hope to build their profile in traditional news or via search media.

Social media engagement is not without risk—particularly in making any potentially controversial statements or inadvertently revealing non-public information. Therefore, it is essential that the firm’s communications team develop clear guidelines for a private equity leader’s social strategy in collaboration with legal and compliance.

The question the leaders of top private equity firms should be asking isn’t whether or not to establish a personal presence on LinkedIn, but rather how best to do so in a way that helps them achieve their business goals.

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