7 Reasons Why Private Equity-Backed Companies Need NetSuite Now

Private equity-backed companies do not have the luxury of time. Investors expect fast results, but behind the scenes, managing multiple entities, consolidating financials, and ensuring compliance can turn into a logistical nightmare. The more your company grows, the harder it becomes to track performance, integrate acquisitions, and make real-time decisions, especially if you are dealing with outdated systems and manual processes.

How much time does your team spend closing the books? How often do reporting delays impact investor confidence? If financial inefficiencies are slowing you down, they are also costing you money. This is where NetSuite comes to your rescue.

As a cloud-based ERP designed for fast-moving companies, NetSuite eliminates bottlenecks, automates complex processes, and brings real-time financial visibility across the entire portfolio. This blog breaks down why NetSuite has become the go-to choice for private equity-backed firms and how it can help you stay ahead of operational chaos.

Understanding Private Equity-Backed Companies

A private equity-backed company is a business that has received investment from a private equity (PE) firm. These PE firms raise capital from institutional investors, pension funds, and high-net-worth individuals, deploying it into companies they believe can grow rapidly and yield high returns. 

The goal is typically to scale the company over a period of 3-7 years before selling it at a higher valuation, either through an acquisition, merger, or initial public offering (IPO).

How Private Equity Structures Work

PE firms invest in companies using different approaches:

• Buyouts: The PE firm acquires a controlling stake in a company, often restructuring operations to drive efficiency and growth.

• Growth Investments: The firm takes a minority stake, providing capital and strategic guidance while the existing management team remains in control.

• Buy-and-Build Strategy: A firm acquires multiple smaller companies in the same industry and integrates them into a larger, more competitive entity.

A PE-backed company usually operates as part of a larger portfolio, meaning it may be one of several businesses under a single investment fund. Some firms focus on a single industry, such as technology, healthcare, or manufacturing, while others diversify across multiple sectors.

As per Citizens Bank report, the number of private equity-backed companies in the U.S. has grown by over 400% since 2000, while the number of publicly traded firms has declined by 35% during the same period. The shift reflects a preference for private ownership models, where businesses can scale without the scrutiny and short-term pressures of public markets.

A Recent Private Equity-Backed Growth Story

A recent example of a PE-backed expansion strategy is Bluejack Fire Holdings, a company launched in 2024 by Agellus Capital. The PE firm acquired three fire and life safety companies, namely FirePro Tech, Chase Fire, and AAA Fire Protection Services, and combined them into a single platform. Additional acquisitions are in the pipeline to further expand services and geographic reach.

This is a buy-and-build approach, where private equity firms create value by consolidating smaller businesses within a niche industry. The strategy helps portfolio companies scale quickly, increase efficiency, and improve profitability.

But, managing such complex structures requires an ERP system that can integrate multiple entities, streamline reporting, and support aggressive scaling.

Challenges Faced by PE-Backed Companies

While private equity brings capital and strategic expertise, companies under PE ownership face unique operational and financial challenges:

• Acquisitions and growth initiatives demand scalable systems and streamlined workflows.

• Investors expect real-time visibility into financial performance, often across multiple business units and currencies.

• PE firms look for cost reductions and process improvements, which can be difficult to achieve with legacy systems.

• Expanding across industries and geographies requires companies to handle different tax structures, audit requirements, and reporting standards.

Without a modern, cloud-based ERP system, these challenges can slow growth and create inefficiencies. NetSuite offers a way to unify financial data, automate processes, and provide the real-time insights that private equity firms and their portfolio companies need to operate smoothly and scale with confidence. 

In the next section, you will see why it is the preferred choice for PE-backed businesses.

Why Private Equity-Backed Companies Need NetSuite

Private equity-backed companies move fast, whether through acquisitions, aggressive expansion, or restructuring. But with speed comes complexity! This means managing multiple entities, consolidating financials, ensuring compliance, and maintaining visibility into operations. 

Relying on disconnected systems, spreadsheets, or outdated ERP software creates inefficiencies that slow down decision-making and growth. NetSuite eliminates these roadblocks by providing a unified, cloud-based platform tailored to the needs of PE-backed businesses.

1. Scalability: Supporting Aggressive Growth

Scaling a PE-backed company often means opening new locations, acquiring businesses, or entering new markets. But legacy systems and disconnected tools can’t keep up. Every expansion effort adds new financial structures, regulatory requirements, and reporting complexities, forcing teams to manually reconcile data from different sources.  

NetSuite’s cloud-based architecture is designed to scale with your business, making it easier to integrate new acquisitions, expand to new markets, and standardize operations across multiple entities.

• Faster onboarding of new acquisitions: NetSuite enables quick integration of financials, inventory, and operations, reducing post-merger disruptions.

• Modular flexibility: As your business grows, you can activate additional modules for advanced financials, supply chain management, and e-commerce without system overhauls.

• Global scalability: With multi-language, multi-currency, and tax compliance features, NetSuite supports international expansion seamlessly.

2. Unified Financial and Operational Visibility

PE-backed firms need clear financial oversight to track performance and measure value creation. But, those using multiple software solutions often deal with delayed financial reporting, data inconsistencies, and manual consolidations. 

Month-end closes take longer, and leadership lacks real-time insights into revenue, cash flow, and profitability. Without a unified system, making data-driven decisions becomes slow and cumbersome.

NetSuite consolidates such financial and operational data into a single system, giving stakeholders real-time visibility into business performance across all subsidiaries.

• Real-time dashboards: Gain instant access to key metrics like revenue, margin, and cash flow across all entities.

• Automated financial consolidation: No more manual reconciliations; NetSuite automatically consolidates financials from different subsidiaries.

• Drill-down reporting: Easily analyze performance at entity, department, or transaction level to support informed decision-making.

3. Streamlined Multi-Entity and Multi-Currency Management

As PE-backed companies expand, they often operate multiple subsidiaries across different countries. Managing multiple entities with varying currencies, tax structures, and financial regulations can be overwhelming. 

Legacy systems typically require manual currency conversions and intercompany transaction reconciliations, which increases the risk of errors and non-compliance.

NetSuite simplifies multi-entity management with built-in automation and compliance features, allowing companies to scale without the complexities of disconnected systems.

• Automated multi-currency transactions: NetSuite supports over 190 currencies and real-time exchange rate updates.

• Intercompany transaction management: Automates intercompany eliminations and ensures compliance with global accounting standards.

• Localized tax compliance: Built-in tax engines adapt to different jurisdictions, reducing the risk of compliance errors.

4. Improved Governance, Risk, and Compliance (GRC)

With PE firms demanding greater transparency and regulatory bodies enforcing stricter compliance standards, financial governance is more critical than ever. Companies relying on outdated ERP systems or spreadsheets often face audit challenges, data inconsistencies, and increased exposure to fraud or misreporting. 

Without an integrated compliance framework, keeping up with tax regulations, revenue recognition standards, and reporting requirements can be overwhelming.

NetSuite strengthens financial governance with automated controls, audit trails, and built-in compliance features that reduce risk and enhance reporting accuracy.

• Automated revenue recognition: Compliant with ASC 606 and IFRS 15, ensuring financial accuracy.

• Audit-ready financials: Provides detailed transaction logs and approval workflows for better governance.

• Role-based access controls: Restricts financial data access to authorized personnel, reducing fraud risks.

5. Flexible Licensing and Ownership Model

Many PE-backed firms operate within tight budgets and require cost-effective solutions. Traditional ERP systems often involve large upfront investments, ongoing maintenance costs, and expensive upgrades, making them financially impractical for high-growth companies. Additionally, on-premise solutions lack the flexibility needed for scaling operations efficiently.

NetSuite’s cloud-based subscription model eliminates hefty upfront costs and offers flexible licensing tailored to your company’s evolving needs.

• Subscription-based pricing: No large capital expenditures—pay based on usage.

• Automatic updates: Stay ahead with the latest features and security enhancements without costly IT upgrades.

• Lower IT overhead: Eliminates the need for in-house infrastructure and reduces ongoing maintenance expenses.

6. Post-Merger/Acquisition Integration

Mergers and acquisitions (M&A) are a key strategy for many PE-backed companies, but integrating financial and operational systems across multiple entities can be complex. Companies often struggle with disjointed accounting systems, inconsistent reporting formats, and prolonged post-merger integration timelines. Delays in financial consolidation can hinder decision-making and affect business continuity.

NetSuite simplifies post-merger integration by providing a unified platform for financial, operational, and reporting alignment across newly acquired companies.

• Faster onboarding of acquired companies: Standardized financial processes enable quick data migration and consolidation.

• Centralized reporting: Provides a single source of truth for financials across merged entities.

• Process standardization: Ensures consistency in workflows, reducing inefficiencies across different business units.

7. Actionable Insights for Value Creation

Private equity investors and management teams rely on key performance indicators (KPIs) to track value creation and drive operational improvements. Without a modern ERP, companies struggle with delayed reporting, inaccurate forecasts, and fragmented data, making it difficult to measure and achieve strategic goals.

NetSuite provides real-time analytics, forecasting tools, and AI-driven insights that help private equity-backed companies maximize value creation.

• KPI tracking in real-time: Monitor EBITDA, revenue growth, and cash flow with customizable dashboards.

• Scenario modeling and forecasting: Use AI-powered insights to project financial outcomes and optimize strategies.

• Performance benchmarking: Compare company performance against industry standards for continuous improvement.

While NetSuite provides the flexibility, scalability, and automation that private equity-backed companies need, the right implementation approach ensures a smooth transition, faster adoption, and long-term efficiency. Going for an experienced NetSuite implementation partner who understands the complexities of PE-backed firms can make all the difference. 

Choosing the Right NetSuite Implementation Company

Selecting the right NetSuite implementation partner is crucial for those aiming to maximize their investment and achieve seamless integration. An experienced partner brings not only technical expertise but also a deep understanding of the unique challenges faced by PE-backed firms, such as rapid scaling, complex financial structures, and the need for real-time reporting.

When hiring for NetSuite ERP implementation services, consider the following factors:

• Ensure the partner has a proven track record in your specific industry, understanding its nuances and regulatory requirements.

• A partner providing a full spectrum of services, from initial consulting and customization to integration and ongoing support, ensures continuity and a deeper understanding of your business processes.

• Look for documented case studies or testimonials that demonstrate the partner's ability to deliver tangible results.

• Continuous support and training are vital to adapt to evolving business needs and to fully leverage the capabilities of ERP.

With over 15 years of experience, Closeloop offers end-to-end services, including NetSuite implementation consulting, custom ERP development, integrations, and managed services. Our approach ensures that the NetSuite ERP system aligns perfectly with your business objectives, facilitating smoother operations and accelerated growth.

Real-World Case Study

Cordance, a private equity-backed firm specializing in scaling B2B SaaS companies, struggled with fragmented financial processes, manual billing, and revenue recognition challenges. 

We implemented a scalable NetSuite ERP solution, integrating SuiteBilling and Advanced Revenue Management, which streamlined financial operations and improved reporting. 

Within six weeks, Cordance achieved automated invoicing, standardized financial processes, and enhanced revenue tracking, demonstrating the impact of choosing expert NetSuite implementation consultants. You can read the full case study here.

Wrapping Up

Private equity-backed companies operate in a high-stakes environment that demands efficiency, scalability, and real-time insights. NetSuite delivers a centralized, cloud-based solution that simplifies financial management, streamlines operations, and accelerates growth, making it a strategic asset for PE-backed firms.

Partnering with an experienced NetSuite implementation company like Closeloop ensures a successful deployment, helping you get the most out of your investment. Whether you are going through post-merger integrations, expanding globally, or refining your financial operations, NetSuite provides the foundation you need to meet investor expectations and achieve long-term success.

Ready to transform your private equity-backed company with NetSuite? Let’s talk.