“It’s Mostly About People:” George Rossolatos on CPAs in Private Equity

Private equity has not been immune to the turbulent political and economic landscape, and what will happen in the months and years to come has become hard to predict.

Businesses are looking to CPAs for their insights and expertise amid this tumultuous climate.

Last week, we sat down with George Rossolatos, FCPA, FCA, to talk about his experience, his outlook, and how CPAs can thrive in private equity. George will be leading a session on private equity and valuation as part of CPA Ontario’s Innovation Leadership Accelerator on April 22. Interested CPAs can learn more about ILA and this year’s presenters here.

George founded the Riverdale Capital Corporation, an advisory and consulting company that provides advisory, consulting, governance and mediation support to CEOs and Boards. George was also the founding Chief Executive Officer of the Canadian Business Growth Fund, a private equity firm that has over $545 million worth of capital commitments.

Altogether, George has over two decades of experience in the private equity space, but before that, he earned his CPA designation.

“I chose to become a CPA at the time because I knew it would keep options open for me down the road.” explains George. “After I completed my CPA, I fell into private equity – due in part to luck, part to skill, and I found that the CPA was super valuable.”

During his tenure, George has noticed some significant changes in the role of private equity in the overall business environment.

“Twenty years ago, private equity was primarily about making money through financial engineering... now, it has become so much more competitive because of the proliferation of private equity firms, in the US and Canada, which are paying higher multiples for companies,” he notes.  “More and more, private equity professionals need to understand strategy and value creation as financial engineering can no longer be counted upon for returns.”

Complicating matters further, Canadian funds are doing a significant amount of work with US partners. Amidst the ongoing trade turmoil and economic conflicts with the U.S., seeing through the fog has become a challenge.

“So much of our economic output is based on exports and our relationships with the U.S,” said George. “However, once things become clearer, I think we will see a reactivation phase of private equity activity – as new opportunities emerge whether in the US, Canada or in new markets.”

George maintains that building relationships is one of the most important parts of finding success in private equity. Interpersonal skills are just as important as technical and financial savvy.

“It’s about convincing companies they can trust you – and vice versa. You need to understand the cultures of these companies, learn whether they are scalable, and figure out how they can be improved,” he explains. “At the end of the day, financial skills are important but it’s soft skills that distinguish, and what really sets people apart in the private equity world is having a balance of both.”

The CPA designation combines financial acumen with strategic insights and personal skills – which is why there are many opportunities for CPAs interested in exploring private equity.

“While some would label a CPA as a non-traditional hire vs investment bankers in private equity, CPAs bring unique skills to the table,” says George. “Being a CPA in private equity is incredibly valuable. There are obviously some areas where you must catch up, but there are also areas where you are stronger than others.”

“It’s really important for CPAs to broaden their backgrounds and their experiences and understand more than the numbers - how to make things better, how to improve operations, how to do acquisitions and how to integrate companies. They need to parallel financial analysis and modeling skills with an investment banking-level intensity, but they also need broader skills – CPAs must be well versed on both sides.”