Rob Hetherington leads Milestone Performance Partners, the portfolio optimisation capability in Bregal Milestone. He is an investor in Bregal Milestone and has previously acted as a Senior Advisor to the firm and as a Board Advisor to Basware, one of the firm’s portfolio companies. Rob has over 25 years’ experience in international leadership roles in some of the foremost software and services businesses in the world.
As an Operating Partner, how do you think about value creation and where your role begins versus the portfolio executives’ role?
Company executives are the people who actually execute value creation – we don’t do that as the fund, so they are accountable for the achievement of outcomes.
If we abide by that principle, then we as the fund shouldn’t be interfering or making executive operational decisions ourselves. We should be engaging and potentially directing the team, but in the end it’s their decision. If we don’t like the decisions they’re making, then the remedy is to change the team – not dive in and make those decisions ourselves.
It’s terribly tempting to look at a set of numbers and say, “Cut this headcount or cut that cost”. But our job is to say: “your overall cost base needs to get from X to Y – now management, go and figure out how”. We can help with insights and perspectives, but in the end the decisions need to be theirs. That’s how we think about what decisions we make versus what they make.
How do you approach situations where executives need more direct support?
We do have situations where the executive team just needs some assistance to get stuff done – say a company transforming its engineering team across a few key programs and the CTO is new in role.
In that kind of situation, we’re happy to jump in and effectively dictate the answer in that area, leveraging our skills and expertise – not to cut across the CTO, but to turbocharge progress.
But ultimately, the CTO is still accountable. We can organise, set up robust plans, decide who’s accountable. What we can’t do is the actual doing – that has to fold back into the engineering team.
If management disagrees with you, how do you balance healthy debate with – at the extreme end of the spectrum – knowing a leader may not be right for the role?
That’s the judgment we’re almost continually applying. We want management teams to have a point of view and feel deep commitment to the outcomes.
If we say the answer is X and they say it’s Y, we’ll have what is hopefully a reasoned debate. More often than not, if we have confidence in the team, we’ll go with their view. If we don’t, we’ll keep them on a short leash.
We might still kick off with their view, but make it clear that if we need to course-correct, we will. They need to stand by the achievement of results. If I’m not prepared to back someone’s judgment, they shouldn’t be an executive in any of our portfolio companies.
What have you learned about when – and how – to make executive changes?
Probably the biggest learning is: act quickly and act early. There’s no point assuming people can change and no point thinking you can develop them into the role – we simply don’t have the time.
Our instincts about people are generally proven to be correct. We’re much better off replacing quickly than holding on and hoping for a better outcome. Of course, we must act with integrity, be fair and give people enough time to prove one way or the other. But the critical period is immediately post-investment – that’s when you can change and reset substantially. And it’s not unusual now for us to swap out a number of the incumbent executive team once we’ve stepped into an investment.
Another learning is that different roles have different tenures – particularly the CRO. It’s very unusual for a CRO to go through an entire four- or five-year cycle. We should think of CROs as having 18-24-month tenures. If we need to build a mature go-to-market capability, that’s one type of CRO. Once it’s built and the engine is firing, scaling it is a different skill set. We shouldn’t assume the same person has both.
Which roles are becoming more important in PE-backed SaaS and software businesses?
The fundamental importance of the traditional roles continues: CRO, CFO, CTO or CTPO. AI is not the preserve of one executive. The entire leadership team needs to embrace AI and drive it into their areas of responsibility. We shouldn’t be hiring people who aren’t conversant in AI tools or who don’t have an agent they’re leveraging to make themselves more effective. That’s table stakes.
The role we’ve introduced more and more is the Chief Transformation Officer. Most C-level execs in businesses we invest in are business-as-usual folk: they can optimise and scale their own areas, but they’re generally not very good at transversal change or executing big programs across multiple functions. And even if they are, they often don’t have the time. So the CTrO is a critical role, even if only for a couple of years, reporting to the CEO and board, accountable for delivering the change required by the value-creation plan.
The industry can no longer rely on multiple expansion. How does that shape your operating philosophy?
We can’t succeed through financial engineering. We have to succeed through operational performance improvement and through accretive acquisitions. We can’t just hope that because time passes we’ll get a multiple lift.
How is your team evolving to meet this new era of private equity?
When we set up the value creation team five or so years ago, it was an incremental build as budget allowed. We started with a couple of generalists who could turn their hands to many things. We’ve now evolved to a senior group of specialists: that’s the model that works for us. I want an ex-Chief Technology Officer leading what we do in engineering. I want a Chief Digital Officer leading what we do in data science, analytics and delivering our AI aspirations. I want a strong finance guy anchoring what we do with CFOs. These are relatively senior people. Our model is an inverted pyramid – not the classic investment-team pyramid. We’re a small shop. If I’ve got a choice between a couple of junior guys and one senior guy, I’ll choose the senior guy every time – he’s more impactful. That’s how we’ve evolved.
With limited time and multiple companies competing for attention, how do you decide where to focus?
It’s tough. The natural inclination is to focus on the underperforming subset of the portfolio and try to lift them back up.
My view is we probably spend a disproportionate amount of time doing that and not enough time with the companies that are performing well, but could get a further lift. Every operating team probably has the same problem. We try to guide our focus by asking: how do we accelerate enterprise value?
We spend more time early in the investment cycle. We also spend a lot of time pre-deal, trying to get value-creation planning done before we ink the deal. If we know we need a CFO or CRO, we’ll launch or close those searches by the time we complete.
We also spend more time running up to an exit: preparing the team, cleaning up the business, developing the equity story.
Acquisitions will pull time too. Some companies need a lot of help; others have an integration machine and don’t. It’s not easy or straightforward.
What advice would you give someone transitioning from corporate leadership roles into an Operating Partner role?
If you haven’t worked with private equity firms or in a PE-backed business, there’s an adjustment. The adjustment is the absolute focus on value creation – pound, shillings and pence. Focus on things that drive uplift in top line or bottom line.
Second is speed. Things tend to happen at warp speed. Tactical action that has an impact is often more valued than robust strategic thinking. Make a decision and get things done. Move fast, break things, then reassemble – that’s better than sitting back and admiring the problem.
Lastly, if you’ve come from somewhere that is the epitome of what good looks like, use it. That’s hugely valuable. Bring the best of that into what you do and you’ll be in good shape.
Rob Hetherington was interviewed by Harry Brooks (Director) in December 2025.