The Gen Z Effect: Adapting Strategies for Success in PE and VC Portfolio Companies

The workplace is evolving, and Gen Z is shaking things up in ways we’ve never seen before, especially for portfolio companies in the world of Private Equity (PE) and Venture Capital (VC). They’ve brought in a whole new approach to work, and understanding these changes is crucial for companies to thrive.

So, how does Gen Z feel about work? Well, they’re all about work-life balance. They’ve coined a concept that I am sure you have heard of by now called ‘Quiet Quitting.’ Instead of storming out of the office, they’re saying, “Hey, I’ll do what’s needed but without the hustle culture overload, thanks!” It’s about keeping income coming in without burn out that so many Gen Xers and Boomers understood to be a part of the game. In many ways it may be a more healthy approach but, it truly confuses many of todays Sr. Leaders.

Then there’s ‘Coffee Badging’—a trend that emerged after the pandemic. In effect they are saying, “Okay, boss, I’ll swing by the office for a coffee and catch up, but then I’m out.” They’re pushing back against the idea of being chained to desks, craving flexibility.

Oh, and ‘Moonlighting’! Sneaky, right? Gen Z is out there, grabbing "side gigs" with or without telling their main employer. Platforms like Swiggy, even encourage it! It’s all about hustling on the side for extra cash.

And let’s not forget ‘Job Hopping.’ Gen Z has none of the old time mental constraints about switching jobs regardless of how long they have been at a company. Why? Well, they’re all about diversity—seeking new challenges, learning new stuff, and perhaps most importantly, finding workplaces that match their values.

As we move toward the later half of this decade (2025 to 2030), brace yourself for a major shift in the workforce. Gen Z will be upwards of 30% of the full time workforce by 2030 and that means these belief systems and their approach to work will continue to become more the norm when hiring workers directly out of school those that are early in their careers.

So, what can PE and VC companies do to groove with this new wave? First off, flexibility is key. Offering work arrangements that fit their style—remote work and flexible hours are a solid first step.

Next, shift your thinking from time spent to "results". Focus on what’s getting done rather than the clock. That’s the metric Gen Z and future generations, (like Gen Alpha who will make their appearance in the workforce in 2035) are and will focus on.

Providing diverse experiences within the company is another win. They’re all about growth, so throw in opportunities that challenge them and help them level up.

So, buckle up, folks! Gen Z is here and like it or not they are changing the game. Adapting to their desire for flexibility, diverse opportunities, and transparent communication will keep your company in sync with the times and more ready for whatever the future holds.