BOTTOM LINE UPFRONT
Many private equity investors assume companies must trade off growth, profitability, or culture as they scale. Accordion’s experience suggests the opposite: with the right operating discipline, culture becomes the system that enables faster growth, stronger margins, and more durable value creation.
When we returned 4.7 times invested capital to our first private equity partner in three and a half years, they told us something at their annual meeting that stuck with our CEO Nick Leopard.
“We always pushed back on Nick,” they said. “You can’t have all three. High growth, high profitability, and a great culture. You have to give on one.”
It’s the kind of line that sounds like wisdom because everyone in the room has watched it happen: Growth strains culture, profitability pressure cuts corners on people, and somewhere along the climb, something gets sacrificed.
Nick disagreed then; he disagrees now. More important, the results back him up now.
The math behind the disagreement
Accordion took on its first PE partner in 2018. Over the next three and a half years, revenue went from $36 million to $179 million. Net Promoter Scores, already high, stayed high through the entire ascent. Culture wasn’t the casualty of that growth. Instead, it became the operating system supporting it.
That combination is rare enough that most PE professionals assume it can’t be built on purpose: it has to be luck, or timing, or a market that happened to cooperate. Nick’s answer is more specific than that. Culture was treated as a strategic input from day one, with the same discipline applied to revenue targets or acquisition theses. Growth and profitability were the byproduct of that culture.
The tradeoff assumption treats growth, profitability, and culture as three things competing for the same limited resource. In practice, they compete for the same limited resource only when a company is undisciplined about all three at once.
Accordion’s answer was industrialization. Early on, our firm operated as a collection of smart individuals parachuted into client engagements. That model works until a company tries to scale it. Clients started to expect something more specific than talented people doing good work. They expected a consistent experience regardless of who showed up.
Building that consistency meant investing in learning and development, building playbooks, and creating a common methodology so outcomes reflected a system rather than individual heroics. That is a profitability decision and a culture decision at the same time. Consistency protects the client experience, and it protects the people delivering it from carrying the entire burden of quality on their own judgment.
The discipline behind the numbers
Bain & Company has studied why fast-growing companies lose their way. Four pitfalls show up again and again: a founder who stays in the middle of every decision, a loss of accountability as the company scales, leadership drifting away from the front lines, and revenue outrunning talent.
Accordion built its growth around avoiding all four, deliberately and continuously.
When our first sponsor came in as a partner, we brought in a new COO from Bain, who introduced concepts like operator models, unit economics, and performance-based compensation. That is an admission that comes with real cost to ego, and it is also exactly the kind of decision that prevents the unscalable founder team pitfall from taking hold.
On talent, Accordion applies a filter to every acquisition before it applies a financial one. The team asks whether they would want to be in a battle alongside the people they are acquiring. Culture fit gets evaluated before deal terms. That ordering is a direct answer to the fourth pitfall: never let revenue grow faster than the talent needed to deliver against it.
None of this means growth, profitability, and culture come free. It means the sacrifice most PE operators assume is inevitable is really a sacrifice of speed, and only in the short term. Building playbooks slows a company down before it speeds one up. Screening for cultural fit in M&A means walking away from deals that look good on paper. Bringing in outside leadership over loyal early hires is a hard conversation before it’s a growth unlock.
The companies that get told they have to give on one of the three usually haven’t built the discipline to protect all three simultaneously. That’s a resourcing and operating model problem. It is not, as it’s often misunderstood to be, a hard law of business.
The next time a sponsor (or on the other side – a portfolio company’s leadership team) tells you growth is going to cost culture, or that profitability targets mean cutting the talent investment, ask what discipline is truly missing, because there has to be one. The evidence from firms that have done this at scale points somewhere more useful than a tradeoff: toward the operating decisions that make all three possible at once.
Read more from Nick’s interview on this very subject on the Ivy podcast here.