Artificial intelligence and private equity: a revolution in the making
Artificial intelligence is emerging as a strategic lever for private equity. Historically focused on financial and operational optimization, funds must now leverage this new tool to boost the performance of their holdings and stimulate value creation.
The adoption of artificial intelligence (AI) in private equity is accelerating. According to a survey conducted by Bain & Company among PE managers representing $3,200 billion in assets under management (1), nearly 20% of portfolio companies have already integrated generative AI solutions with concrete results. However, many funds are still at the experimental stage, seeking to formalize a coherent, replicable integration strategy.
Some players are ahead of the game. Apollo has created an AI Center of Excellence to pool expertise and accelerate the adoption of AI within its holdings. Thoma Bravo, a leader in the software sector, integrates AI as a key optimization and growth lever for its holdings.
The fund places particular emphasis on automation, predictive analytics and SaaS model optimization, with concrete applications in cybersecurity, analytics and business planning. These initiatives testify to a profound transformation: AI is no longer a mere opportunity, but a strategic imperative.
Three strategic axes for creating value through AI
1. Operational optimization and cost reduction: AI helps streamline business processes and improve productivity. In software development, AI's contribution to code generation has enabled portfolio companies to increase their productivity by 30%. In administrative and financial functions, AI speeds up data processing, optimizes contract management and reduces the costs associated with repetitive tasks. For example, LogicMonitor, an IT infrastructure specialist, deploys predictive AI to reduce corrective interventions and generate up to $2 million in annual savings per customer.
2. Accelerating growth and increasing revenues: AI becomes an expansion driver for portfolio companies. In the SaaS sector, AI-powered sales optimization tools improve conversion rates and help penetrate new customer segments.
3. Improved valuation and exit multiple: AI is also revolutionizing the analysis of portfolio companies. Thanks to advanced data processing models, funds can analyze a target's financial health more quickly, detect inefficiencies and identify growth opportunities. Also, when selling a company, successful AI integration is a key valuation argument and can justify higher exit multiples.
The challenges of AI integration and the key role of PE funds
While AI presents major opportunities, several challenges are holding back its adoption: resistance to change, team training, data quality and reliability, technology infrastructure requirements and sectoral heterogeneity.
Private equity funds, as strategic shareholders, are key catalysts in overcoming these obstacles by investing in AI capabilities, structuring transformation plans and supporting managers as they build their skills.
AI, the future standard for private equity?
AI does not replace the fundamentals of private equity, but it redefines the way value is created and captured, acting as a catalyst. In an environment where differentiation and performance are key, funds that know how to structure and industrialize the use of AI will enjoy a decisive competitive advantage.
Institutional investors are already beginning to take into account the ability of fund managers to integrate and use AI as a differentiating selection criterion. In the near future, mastery of these technologies could well become a key factor in the evaluation of a fund, on a par with financial performance or risk management.
(1) Bain & Company, Global Private Equity Report 2025
