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AI & Digital Transformation: A Private Equity Value Creation Lever – Part II
by Eric Walczykowski
Private equity deal valuations today hinge on far more than just revenue.
Companies' business velocity and operational efficiency now carry equal weight in our evaluations - and their technological capabilities can dramatically swing valuations in either direction.
I recently sat down with Vitaly Gordon, CEO of Faros AI and former lead of Salesforce Einstein. Our conversation revealed fascinating insights into how artificial intelligence (AI) and analytics are transforming development processes. Private equity firms should leverage these data-driven insights both to uncover hidden value in potential deals and to drive stronger portfolio performance.
I invite you to watch Part II of my conversation with Vitaly here. Here are the key takeaways from our discussion.
AI is no longer an option, it’s a Necessity
AI isn't just another process improvement tool - its impact across business functions is transformative. Think about it this way: we'd never accept our finance teams manually creating spreadsheets when Excel exists. Similarly, companies that aren't leveraging AI tools today are actively losing competitive ground and missing significant value creation opportunities.
During our conversation, Vitaly put it perfectly when he stated:
“Leaders create the most value by driving AI adoption across functions, whether in sales, marketing, or as CEO.”
In my experience driving AI adoption starts at the top. AI technology has proven remarkably accurate in validating and enhancing human analysis. The tools available today are not only powerful but incredibly user-friendly. With such accessible solutions at our fingertips, there's no excuse for watching from the sidelines while competitors gain the advantage.
Hiring an AI-Curious Team vs “Chief AI Officer”
Placing fancy titles like "Chief AI Officer" onto your org chart won't drive real digital transformation.
What does work? Building AI adoption from the ground up, with buy-in across every level of the organization.
I've watched companies make the classic mistake of hiring a single AI leader, expecting them to wave a magic wand. But these leaders often lack the clout to drive real change. When they push sales teams to adopt AI tools, they hit a wall - teams focused on hitting their immediate numbers aren't interested in disrupting their processes for digital transformation.
Through my conversation with Vitaly, one truth became crystal clear: The winners in this space are companies that hire AI-curious talent at every level and build a culture that embraces "failing forward."
This means actively encouraging teams to push AI's boundaries, learn from missteps, and continuously refine their approach. I'm convinced that organizations rewarding thoughtful experimentation and driving comprehensive AI adoption will dramatically outpace their more cautious competitors.
Knowing Who’s the Real Deal vs a Buzzword Connoisseur When Hiring
When evaluating AI expertise, whether in consulting firms or candidates: ignore the buzzwords and focus on the doers. The first question should always be, "Show me how you've transformed your own operations using AI." In my experience, the standout players don't just talk about AI - they actually use it every day.
Vitaly explained the key things to look for when hiring a digital transformation leader. You shouldn’t be interested in just theoretical knowledge. Seek out those who show genuine excitement paired with hands-on implementation experience. Look for people who can point to specific examples of putting AI to work. You can tell immediately who's actually rolled up their sleeves and who's just memorized the latest tech jargon.
Using AI for 2025 Planning
Push your teams to set ambitious targets. The old playbook of doubling headcount to get 50% more productivity is dead. This isn't just an operational shift - it's a fundamental reimagining of how we plan for growth and allocate resources. Companies that don't make this mental leap will find themselves falling behind fast.
AI is fundamentally reshaping how private equity evaluates, values, and grows companies.
The firms that will win in 2025 and beyond are those building AI-driven cultures from the ground up, hiring doers over talkers, and completely rethinking their growth models. The choice is simple: embrace AI's transformative potential now, or risk watching your competitors race ahead while you play catch-up. Private equity-backed companies are looking for bold leaders ready to harness AI to drive exponential value creation.
About Faros AI
Faros AI helps companies like Discord, Vimeo, and Coursera improve engineering productivity and optimize the developer experience. Powered by the cutting-edge Lighthouse AI engine, Faros AI delivers real-time insights, uncovers bottlenecks and their root causes, and offers personalized recommendations to boost velocity and quality.
Connect with Faros AI to learn more:
About Bespoke Partners
Bespoke Partners is the largest recruiting firm solely focused on software and SaaS companies, and we specialize in firms backed by private equity sponsors. Bespoke Partners can help companies seize emerging opportunities by staying ahead in the software and SaaS leadership market.
Connect with Bespoke Partners to learn more:
Bespoke Partners Named in Top 10 of the “Top 49 Retained Executive Search” 2-Years Running by C-Suite CV Secure.
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