The State of NPS in Private Equity-Backed Companies: 2025
Introduction
Customer experience (CX) is a growing area of focus for private equity (PE) firms. With hold periods shrinking and investor expectations increasing, understanding the voice of the customer has become a necessity, not a luxury. NPS, a metric that measures customer loyalty by asking how likely customers are to recommend a company, offers an accessible and scalable way to quantify customer sentiment. However, many PE-backed companies fail to use NPS effectively.
The Role of NPS in Value Creation
NPS serves as an early warning system for customer dissatisfaction and a directional indicator of growth potential. High NPS is correlated with stronger customer retention, lower acquisition costs, and higher margins. In private equity, where rapid value creation is key, this metric can provide critical insight into areas that drive or inhibit enterprise value.
Used properly, NPS supports three main levers of value creation:
Revenue Growth – Satisfied customers are more likely to refer others and expand accounts.
Margin Expansion – Reducing churn and repeat service costs drives efficiency.
Valuation Uplift – Demonstrating CX maturity improves market perception and exit multiples.
PE firms that integrate NPS into their value creation plans can uncover hidden risks and opportunities in the customer journey. But without structure, the signal is lost in the noise.
What is NPS and How Is It Calculated?
Net Promoter Score (NPS) measures how likely customers are to recommend your company to others. It’s based on a single question: “On a scale from 0 to 10, how likely are you to recommend our company to a friend or colleague?”
Responses are grouped into three categories: • Promoters (9–10): Loyal enthusiasts who drive growth through referrals. • Passives (7–8): Satisfied but unenthusiastic customers. • Detractors (0–6): Unhappy customers who may damage your brand.
The calculation is simple: NPS = % of Promoters – % of Detractors. For example, if 60% of respondents are Promoters and 20% are Detractors, your NPS is +40. Scores range from -100 to +100: A positive score means more promoters than detractors. A score above +50 is considered excellent.
How CSAT Complements NPS
While NPS provides a high-level view of customer loyalty, Customer Satisfaction Score (CSAT) measures satisfaction with specific interactions or transactions. Typically captured by asking, “How satisfied were you with your experience?” and rated on a 1–5 or 1–10 scale, CSAT offers tactical insights that can guide day-to-day service and operational improvements.
The key difference is that CSAT reflects immediate sentiment at a particular touchpoint, while NPS gauges long-term advocacy and brand perception. Both metrics are valuable, NPS helps identify strategic risk and growth opportunities, while CSAT helps surface friction in moments that matter. Used together, they provide a well-rounded understanding of the customer experience and support faster, more precise decision-making.
How to Best Execute NPS
Successfully implementing NPS as a tool for growth requires more than sending surveys. Companies must embed it into the customer journey, connect it to operations, and align insights with decision-making. Below is a best-practice execution model that ensures NPS becomes a value-driving capability:
Align NPS with Customer Journey Mapping
Start by mapping the end-to-end customer journey to identify key Moments that Matter (MoMs)—critical touchpoints that shape customer perception and influence loyalty. Ensure NPS is captured at these moments to reflect real experiences.Pair NPS with CSAT at Transactional Points
Use CSAT alongside NPS to capture satisfaction at specific events like onboarding, support resolution, or billing. NPS gauges overall loyalty, while CSAT pinpoints friction in day-to-day interactions.Enrich Insights with Contextual Feedback
Go beyond the score. Conduct one-on-one interviews or open-text feedback sessions to understand the “why” behind customer sentiment. This qualitative input adds depth and highlights issues that metrics alone may miss.Analyze and Segment Feedback by Key Dimensions
Leverage analytics and natural language processing to identify themes across customer type, region, product, and lifecycle stage. Segmenting feedback ensures insights are relevant and actionable.Develop Initiative-Driven Action Plans
Translate patterns into initiatives with assigned owners, due dates, and expected business outcomes. Align each initiative with customer needs and key performance indicators like churn, upsell, or service recovery.Embed NPS into Executive and Operational Reporting
Build dashboards that track NPS trends, initiative progress, and resolution rates. Include these metrics in monthly management reviews and quarterly board meetings to drive accountability.
This execution model ensures NPS becomes more than a metric, it becomes a system for listening, learning, and acting that fuels both customer satisfaction and enterprise value.
Benchmarking NPS: What’s a Good Score?
NPS performance varies widely by industry. Here are typical benchmark ranges: • Consumer Goods: +40 to +70 (e.g., Apple: +72, Tesla: +96) • Software/SaaS: +30 to +50 (e.g., Zoom: +62, Microsoft: +45) • Financial Services: +10 to +30 (e.g., American Express: +35) • Healthcare Providers: 0 to +30 • Telecommunications: -10 to +10 (e.g., Comcast: -3)
While NPS is a useful indicator of customer sentiment, it is not a standalone measure of business health. A high NPS does not guarantee revenue growth, profitability, or customer retention. For example: "Why are sales down when our NPS is high?" This often occurs when sales or customer success teams are not challenging clients, up-selling, or driving broader engagement. High NPS may simply reflect that existing customers are content with the status quo, not that the business is growing.
High scores can also create false confidence. Companies sometimes over-index on NPS while ignoring hard performance indicators like declining revenue, falling renewal rates, or softening pipeline activity. Without alignment to operational KPIs, NPS becomes a vanity metric.
Operationalizing NPS at the Portfolio Level
To turn NPS into a repeatable driver of value creation, private equity firms must embed it into the operating rhythm of their portfolio companies. This requires more than tracking scores, it demands structure, accountability, and consistency across teams and functions.
Stonehill recommends the following approach to institutionalize NPS across the portfolio:
Standardize NPS Governance - Define clear ownership and oversight structures. Each portfolio company should have a designated NPS leader or cross-functional team responsible for feedback capture, analysis, and follow-through. Create CX operating models that connect customer feedback to operational leadership.
Integrate NPS into Monthly Reporting - Include NPS, CSAT, and churn indicators in the standard reporting package submitted to operating partners. Ensure that trends are discussed in monthly reviews and tied to sales performance, service delivery metrics, and financial outcomes.
Link Feedback to Journey Maps and MoMs - Ensure that each portfolio company has an up-to-date customer journey map. Embed NPS and CSAT collection at critical Moments that Matter (MoMs)—such as onboarding, delivery, renewals, and escalation resolution—so insights reflect real-world experiences, not isolated events.
Supplement with Qualitative Feedback - Require one-on-one customer interviews at regular intervals. This adds context to survey data and gives teams a clearer view of what’s driving dissatisfaction or advocacy. This qualitative input often reveals root causes not captured in structured surveys.
Translate Insight into Actionable Initiatives - Each company should convert feedback themes into a defined set of CX initiatives. These should have clear owners, delivery dates, and expected business impact. Hold teams accountable for execution and track progress against defined KPIs like NPS lift, churn reduction, or CSAT improvement.
Create a CX Knowledge Exchange Across Portfolio - Encourage knowledge-sharing between companies. Share best practices, tools, and playbooks across the portfolio to accelerate adoption and performance improvement.
By embedding this structure, private equity firms can ensure that NPS is not just a data point, it becomes a management tool that drives cultural alignment, improves customer outcomes, and contributes directly to valuation.
Summary
Net Promoter Score, when used in isolation, is just a number. But when embedded into the operating cadence of private equity-backed companies, it becomes a powerful tool for identifying risk, unlocking opportunity, and driving value creation.
To make this transformation effective, NPS should not stand alone. It must be paired with other critical tools such as Customer Satisfaction Score (CSAT), a transactional metric that captures how satisfied a customer is with a specific experience. While NPS tells you if a customer would recommend you, CSAT tells you how they felt about the most recent touchpoint. The combination of NPS and CSAT provides a more complete and actionable view of the customer experience.
The firms that win in today’s environment don’t just collect feedback, they operationalize it. They use it to prioritize investments, guide product and service improvements, and align teams around what truly matters to their customers.
For private equity sponsors, this isn’t about branding, it’s about value. Operationalizing NPS and CSAT within portfolio companies leads to better customer retention, stronger EBITDA, and increased valuation at exit.
At Stonehill Innovation, we help firms move beyond passive listening and into disciplined action. If you’re ready to turn feedback into fuel for performance, visit www.stonehillinnovation.com or contact us to start a conversation.
About Stonehill Innovation
Stonehill is a nationally recognized strategy and innovation consultancy based in Tampa, Florida, serving Fortune 500 companies, private equity, and government clients. The firm specializes in helping organizations navigate complex challenges by combining advanced analytics, design thinking, and business strategy. Stonehill’s award-winning team partners with clients to drive growth, improve operational performance, and deliver measurable results across industries. Known for its collaborative approach and proven methodologies, Stonehill has built a reputation for excellence in strategic planning, customer experience, and digital transformation.
