The Gaffin Group was pleased to have an article on value maximization published on the Axial network. The Gaffin Group Founder and President, Mark Gaffin, discussed the on-going research effort in this area. “Our Group continues its research efforts into private capital formation and the middle market. An important area of discovery is now the best General Partners distinguish themselves from the ‘also-rans’. In this article, we used Michael Jensen’s concept of value maximization as a corporate objective function as the backdrop. In our consulting work with private equity funds and with operating companies we find similar, compelling results: Those owners who have a laser focus on long-term value creation perform, on average, significantly better than their peers. In a world of constituents competing for the firms’ resources – managers must have a measure of deciding which is the better option or path. Again, this principle holds regardless of ownership [sponsored or not].
We look forward to publishing more of our findings in this area and we appreciate the collaborative relationship we have with the Axial network.”