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Lack of talent in executive positions hinders investments

If your company can’t get its hand on that crucial funding opportunity, it’s most likely that you have a CEO that’s not fit to do the job.

That’s the result of a new research paper by executive search and interim management firm Intramezzo.

The company asked 100 corporate venture capital (CVC) and venture capital (VC) fund managers how they make their investment decisions, and as it turns out, 81 per cent said SMBs are missing out on important opportunities due to the wrong people filling board level positions.

Over a quarter of the respondents (32 per cent of VC and 21 per cent of CVC) frequently feel the need to replace existing CEOs, the report, entitled A Board Fit for Purpose, also says.

The quality, and the strength of the leadership team, is one of the most important factors in the decision to invest in portfolio companies, the report suggests, saying that 85 per cent of respondents said they most likely would not back a company lacking proper skills.

“The makeup of the executive board is crucial to the success of any organisation, but more so for start-ups and high-growth businesses, where they do not yet necessarily have a proven business model or high-levels of revenue,” said Dermot Hill, Chief Executive of Intramezzo-

“The tech scene in the UK is thriving but we are struggling to produce many unicorns (companies valued at $1billion or above) or global giants, and a lack of executive talent could be the main reason why. Ambitious start-ups need a CEO in place who has the potential to be a leader of a £100m business, not just a £1m business. Thinking more strategically about identifying the talent that is needed as the business grows is key to achieving this.”