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Platform Company

Definition

A platform company is the initial acquisition made by a private equity firm within a particular sector or investment thesis. It serves as the foundation business around which a growth strategy — typically involving add-on acquisitions — is built. Platform companies are usually larger, more established, and have the management infrastructure to integrate subsequent acquisitions.

Context

Platform searches are discussed in Ep. 23 as part of VRA Partners' growing buy-side practice. Chris Reilly describes VRA working with PE sponsors on platform searches and add-on acquisitions. For PE firms, communicating active platform searches to boutique bankers is a way to bring value to the relationship — it gives bankers insight into what the firm is looking for and opens opportunities for deal flow in both directions.