Private equity (PE) and venture capital (VC) firms are tightening their grip on hiring budgets, and it’s not hard to see why. The economic uncertainty of 2025 – shaped by shifting interest rates, market volatility and the impact of a new administration – has forced firms to scrutinize every leadership appointment.

Portfolio companies aren’t hiring in waves anymore, and the days of upleveling entire executive teams are on pause. Today, firms are making surgical, high-impact decisions, asking themselves: Who is absolutely essential to survival and growth?

The answer, increasingly, is revenue leadership.

I’ve been watching this trend accelerate. When belts tighten, companies double down on the roles that can prove immediate ROI. Growth, once taken for granted in high-burn, high-reward VC and PE-backed firms, is now a razor’s-edge game. The spotlight is turning towards Chief Revenue Officers (CROs) and heads of sales who don’t just maintain revenue, but multiply it.

If the last decade in private equity was about scaling, this one is about sustaining and accelerating profitable growth in leaner conditions.

Why the CRO is the power player of 2025

For years, sales and revenue leadership in PE and VC-backed firms fell into one of two categories: either a legacy sales leader promoted internally or an aggressive rainmaker who could close deals but lacked a strategic mindset. That approach no longer works.

The priority isn’t just bringing in deals. Firms need people who can architect sustainable, scalable revenue streams. That’s why PE and VC firms, now operating in a world where funding isn’t as cheap or easy, are doubling down on CRO hires.

So what distinguishes a CRO from a traditional sales leader? It’s not just a bigger title. A CRO operates with a full-spectrum view of revenue, integrating sales, marketing and customer success into a cohesive, high-performance engine.

The best CROs in 2025 will need a few key traits:

• A near-obsessive focus on metrics. Investors and boards won’t tolerate “gut-feel” growth strategies. CROs must translate every move into measurable impact.
• Mastery of AI-driven sales strategies. The firms winning in today’s environment are those leveraging artificial intelligence (AI) not just for operational efficiency but for precise, predictive sales and marketing strategies.
• The ability to scale intelligently. The era of “growth at all costs” is dead. CROs must balance aggressive expansion with profitability milestones, all while reverse-engineering growth strategies to position the company for a high-value exit.

CROs have historically been undervalued – and that must change

Despite the importance of CROs, many firms still treat them as disposable silver bullets, so that when growth stalls (often due to factors beyond the CRO’s control), they become an easy scapegoat. This short-sightedness costs a lot of growth.

According to HBR, the average CRO tenure is just 25 months (one of the shortest in the C-suite), and 70% of CROs who leave do so because they’ve been asked. But HBR reveals something else: 62% of companies see revenue stall or decline after a CRO switch, with average growth dropping nearly four points, from 15.5% to 11.7%.

If 2025 is going to be the year of revenue leadership, then it also needs to be the year firms stop underestimating the role. PE and VC firms need to recognize a few things:

• CROs need investment. A strong CRO is an orchestrator of revenue strategy. That means giving them the right tools, team and time to execute.
• Short-term thinking kills long-term revenue. Churning through CROs every two years means firms are constantly restarting their growth engines instead of optimizing them.
• Hiring a great CRO is an investment. Keeping them is a strategy. Firms that fail to see this will stay stuck in a cycle of underperformance.

If you’d like to learn more about the state of Private Equity and Venture Capital in 2025, you can download our latest report.

The economic reality of 2025 means priorities are changing

The political and economic turbulence of 2025 isn’t making leadership decisions any easier. With a new US administration, shifting global markets and evolving economic policies, investor sentiment is swinging unpredictably. Growth expectations won’t loosen, but the pathways to achieving them are becoming more constrained.

What does this mean for PE and VC-backed firms? Well, pressure. The margin for error in sales and revenue leadership is now paper thin. The old strategy – promoting strong individual contributors or hiring aggressive sellers without operational expertise – won’t cut it. Firms need to be more thoughtful with their leadership investments.

The trend is clear: Fewer executive searches, but more emphasis on roles that truly turn the tide. This has led to an increase in up-leveling (promoting from within rather than sourcing external talent). But here’s the catch: if your internal talent bench isn’t already elite, you’re in trouble. Firms that haven’t invested in leadership development will find themselves scrambling to fill gaps at a time when hiring mistakes are costlier than ever.

The firms that recognize the critical nature of revenue leadership and invest in truly strategic CROs will be the ones that navigate this landscape successfully. Those that don’t risk stagnation at best, and failure at worst.

The leadership evolution is here

If I had one piece of advice for PE and VC firms rethinking their leadership strategy in 2025, it would be this: Prioritize revenue leadership now.

Because here’s the truth: Your portfolio companies don’t have time for a slow climb. Markets are shifting, capital isn’t as cheap and the strategy of scaling first and figuring out revenue later is worn out. The firms that win will be those with CROs who don’t just hit targets, but drive aggressive, sustainable growth.

If you’re not certain you have the right revenue leadership in place, let’s fix that. Get in touch with me today and we’ll set aside time for a call.