Cognitive biases are generally present in every aspect of the deal cycle, deal origination, screening, due diligence, investment committee decisions, and negotiations, as well as decisions on how and when to sell.

Biases have a significant effect on deals the firm pursues, but how the investors interact and make decisions about the companies they have invested in is equally important.  These cognitive biases typically increase default risk by 25-30%, and delay investors from acting by an average of 12-18 months when critical changes are needed within the firms that they invest in.  This has a significant effect on success and performance.

At Behaviour Lab we work with private equity firms to identify structural cognitive biases by analysing deals and decision-making processes. We also assess how individuals interact with investment committees and managers leading the companies in which they invest. We then tailor debiasing methodologies, establish standard processes for running debiasing actions, implement necessary changes on an organisational/institutional level, and form ongoing monitoring systems for teams.

“What makes the bias particularly pernicious is that we all recognize this bias in others but not in ourselves.”
― Richard H. Thaler
Misbehaving: The Making of Behavioral Economics


Private Equity Advisor Board

Conor Kehoe

Conor is a former senior partner and leader of the private equity practice at McKinsey. Working with Professor Daniel Kahneman and Professor Olivier Sibony he pioneered the use of behavioural science techniques in board and investment committee decision making. Originally a software engineer, Conor co-founded McKinsey Solutions (now McKinsey New Ventures) which invests in management software tools. He continues as a member of its External Advisory Board.

Conor also brings more than 25 years of experience in helping leading global organizations through their change management journeys.

Elizabeth Mohr

Elizabeth has extensive experience working on governance and board reviews across the FTSE100. She has worked with senior leaders in some of the toughest industries and contexts to help them improve the leadership of their organisations’ governance and, evaluating board effectiveness and providing development for boards, investment committees and their individual members.

Prior to this, Elizabeth worked at McKinsey where her primary focus was on mindset and behavioural change, organisational health, and board and top team development.