When BlackRock announced its $12 billion acquisition of HPS Investment in late 2024, it sent a clear message: private capital isn't just surviving – it's transforming. After two years that tested the industry's resilience, this mega-deal signaled a shift in the narrative. The extended period of challenges throughout 2023 and 2024 reshaped how firms approach value creation, talent management, and operational excellence.

The ability to scale portfolio companies efficiently is a critical factor in driving returns in today’s private equity landscape. Digital transformation may seem like a buzzword, but it’s redefining value creation." Firms embracing these tools pull ahead. Hesitating? They risk falling behind.In our previous post, “Accelerating Growth Through Digital Transformation,” we explored how adopting transformative technologies can unlock operational efficiency, drive strategic growth, and secure a competitive edge. Building on that foundation, we’ll explore AI’s pivotal role in enabling these outcomes.

Private Capital is experiencing a fundamental shift as digital transformation becomes critical to achieving operational efficiency, competitive advantage, and sustainable growth. Leaders in these sectors are increasingly exploring how technology, particularly artificial intelligence (AI) and machine learning (ML), can streamline operations, enhance decision-making, and drive value creation.

As an operating partner in private equity or venture capital, you’re responsible for the critical task of driving value within portfolio companies. In today’s fast-paced market, this role demands a unique combination of operational skills, strategic insight, and innovative thinking. However, recent industry shifts present new obstacles and add layers of complexity. Below, we’ll dive into some of the most pressing challenges you face and discuss strategies that can empower you to succeed.

As the private capital sector continues to experience decreased dealmaking activity, general partners (GPs) and operating partners (OPs) grapple with heightened responsibilities and stretched resources. This blog delves into the current state of the sector, highlighting the challenges posed by a lack of exits and its impact on key players. It also provides valuable insights into what industry leaders expect in the coming years, including the likelihood of market recovery in 2025.