KnowledgeNow: Playing Offense Apax Partners KnowledgeNow Conference October 2015 The 5th Annual Apax Partners Miami, KnowledgeNow Conference took place in Miami on 20 and October 2015 21 October 2015 What’s inside this report? Understanding the customer’s path 02 Introduction 12 People at the centre to purchase Alex Langshur Co-founder and Collective experience as Creating a culture for success Senior Partner, Cardinal Path competitive advantage Trevor Mather Chief Executive, Autotrader Answers & EMC: Tier one solutions Seth Brody Partner and Global Head of Group UK for tier two prices Operational Excellence, Apax Partners Happier customers, better business Curtis Strite Sr. Director Infrastructure David Karandish CEO, Answers Corporation and Operations, and Brian Keithly Lenny Nash Chief Strategy Offi cer, Foresee Senior Engineering Manager, Answers 04 A complex and competitive world Brett Batchelder Senior Director, Growing together through Private Equity, EMC Operations at the core of performance intelligent incentives Mitch Truwit Co-CEO, Apax Partners Brian Robbins Partner, Executive Proactive vendor risk management Compensation & Benefi ts, Simpson Thacher at Acelity The new normal & Bartlett LLP John Elwood VP of Global Manufacturing, Susan Lund Partner, McKinsey Global Institute Acelity and Mark Beckey, Director, Global Sourcing, Acelity Winning with Big Data Billy Beane General Manager, Oakland 18 Working together to drive results Bringing the whole team together Athletics David Edwards IT Consultant, Implementing operational excellence in GENEX Services Tackling the growing cyber threat a growing company James Lyne Global Head of Security Joe Delaney CEO and Pat Rowland Chief Research, Sophos Strategy Offi cer, OneCall Care Management Building leaner, greener businesses Fashioning digital sales expansion Aleyn Smith-Gillespie Associate Director, Josh Krepon VP of Digital Retail, Cole Haan Carbon Trust 26 Attendees28 OEP overview30 The Operational Excellence team KnowledgeNow 2015 01 In attendance... Apax Partners is one of the world’s leading private equity Executives and partners firms. An independent global partnership focused solely on 127 long-term investment in growth companies, our Funds invest in four sectors: Consumer, Healthcare, Services and Tech & Telco. Portfolio companies Apax Funds’ strategy is to drive superior returns through sector 28 expertise, geographic fl exibility and transformational ownership. To that end, the Operational Excellence Practice (“OEP”) Representing... and the fi rm’s vertical domain expertise are brought to bear Enterprise value invested throughout the life cycle of a deal to drive value. The OEP is $32bn+ comprised of resources possessing deep operational expertise and broad acumen as general managers. OEP resources “get $12bn+ Annual sales in the boat” with management teams to drive results. Through the OEP’s KnowledgeNow programmes, Employees communities and conferences, we create forums for 125,000+ executives to share experiences and discuss the common challenges our portfolio businesses face. Our annual conference, held in October 2015 in Miami and recounted in this brochure, is the cornerstone of these efforts. 02 Apax Partners KnowledgeNow 2015 03 The Apax KnowledgeNow Conference Since our last gathering...(1) Our Global Network is an annual event that brings together executives from across the Apax portfolio Growth in mobile traffi c for several days of best practice sharing, +59% networking and discovery. With over 120 attendees, including representatives from Bringing together 28 portfolio companies, our 5th instalment, Cumulative company the CEOs, Partners held in Miami in October 2015, was the $1.3bn speed optimised largest and most impactful since the inception of the program. and Operational Our objective at KnowledgeNow is to Cumulative value of Professionals that present perspectives on the forces of $170m+ contracts generated between Apax drive value across change in the global economy and distill portfolio companies the collective experiences from around Apax’s global portfolio into tangible, our Global Network. actionable insights that can drive near-term performance. As these are executives speaking candidly to each other about the common challenges they face, the power of the event is magnifi ed by the credibility each individual attendee brings as an experienced operator. Revenue growth, margin expansionn, cash generation and Portfolio companies: solid executiion are thhe source of over 75% of the value created in exitedd dealls. OOur shharedd success iis nott just abbout fi nanciial engineeringg. It’t s the work our management teams are doiing every dday. Thhat iis whhy we hhave this conference. To do more. To do it faster. To do it together. Seth Brody Partner, Apax Partners 04 Apax Partners KnowledgeNow 2015 05 The world that we all enjoyed since 1980, in which virtually everyone in this room ddevellopep d thheiir bbusiiness career and set of intuitions about how thingsg work and ddynamiics in your inddusttry pllay, iis gonee. It’’ss overr. Andd thhe new world is goiing tto be all about agility, low costss, and operattiional excellence. Dr. Susan Lund KnowledgeNow: Playing Offense Partner, McKinsey Global Institute A complex and competitive world Complex global economic forces, dynamic competitors entering markets without legacy operations, a daily war for talent, technological disruption and petabytes of data. How can we be playing offense? How do we stay on the front foot? Conference attendees explored these complex issues in Miami. 06 Apax Partners KnowledgeNow 2015 07 A complex and competitive world continued One of the core areas of focus in this At Apax we are laser-focused on helping Susan Lund sets the macroeconomic Opportunities to supply new Operations at year’s conference was how companies our portfolio companies navigate these The new normal scene for companies operating in an customers in new places with can operate and win in an increasingly choppy waters because we know that it is uncertain world. new products uncertain world. operational improvements in our portfolio the core of that will enable us to produce sustainable with Dr. Susan Lund Partner, Seven years after the onset of the fi nancial As well as the challenges outlined above, there will be huge opportunities As Susan Lund points out very graphically outperformance for our investors. McKinsey Global Institute crisis, the global economy continues to performance overleaf, we are operating in a complex be troubled by high levels of public and in emerging markets as 1.8 billion new environment characterised by dynamic We understand that it is the work private debt, while volatility in currency consumers gain access to disposable competitors continually entering markets being done every day by individuals markets, stock markets and commodities income for the fi rst time. Meeting this with Mitch Truwit Co-CEO, without legacy operations. We are right across our portfolio that drives has also increased. Rather than expect a new demand will involve creating new Apax Partners seeing a daily war for talent, constant results. This network of expertise is return to smooth economic growth and products at lower price-points and technological disruption and petabytes our greatest strength, so we will do benign markets, companies should adjust expanding networks to sell these of data on which to make decisions. everything we can to build the dialogue to a world of uncertainty in which GDP products in new markets. This product The over-arching question that framed and increase knowledge sharing across growth could be signifi cantly depressed development could lead to further our discussions throughout the the entire portfolio. until 2050. opportunities to market value products conference is: “how do we focus to customers in existing markets. forward in this environment?” Debt expands, GDP slows and competition becomes more intense The penetration of the internet will allow As PE buyers, despite all these new companies to spring up and compete uncertainties, valuations have been Despite austerity measures and a drive to for customers around the globe with at very high levels in recent years. deleverage in mature markets, public and more established companies. That means Paying top dollar for assets in an private debt has increased by $63 trillion openings for the makers of disruptive uncertain market means that now, since 2007 to 289% of global GDP, with technologies, as well as the potential to more than ever, we need to focus consumers, companies and governments drive new growth at mature companies on driving operational improvements all more deeply in debt than before. As a through partnerships with competitors quickly, allowing us to make the changes result, companies and individuals should in markets like Brazil, China and India. early and get ahead of the game. expect a higher tax environment and more There will also be rewards for businesses regulatory oversight as governments try that look beyond their immediate to reassert control, not just in fi nancial industries for new ideas, as Google services, but across all industries. has done with its fl eet of self-driving cars. A credit boom in China has added $22 trillion to their debt in the last seven years, and fuelled a real estate bubble. While a property crash could be confi ned to China, companies in Europe and the US should be prepared for weakening demand stemming from the reduction in GDP growth that will ensue. The winning companies of the