Persistent’s skin-in-the-game approach focuses on AI readiness through modern tech and data stacks, enabling portfolio companies to become value creators.
Portfolio companies don’t become growth engines with a leadership change or a more targeted sales strategy. For Private Equity (PE) firms, value-creation levers lie in transforming portfolio companies’ technology stack.
But one look under the hood reveals a mesh of technology vendors keeping the lights on. The majority of these vendors operate on an hourly billing model, rooted in a ‘transactional mentality’ that checks off action items from to-do lists. These are red herrings, because keeping the lights on does not raise the bar.
Instead, a strategic transformation partner steps up with a path forward beyond hotspotting technical issues to solving business problems and turning technology into an engine for long-term value creation.
Deep Insights Trump Topical Execution
Tactical vendors often act like utilities, topically managing ERP mergers during carve-outs or keeping infrastructure and servers running. They measure success with budgets, SLAs and uptime. Most importantly, they do not speak the language of the business. They cannot prepare PE firms for blind spots, such as hidden technical debt, fragile architectures, inefficient processes and missed growth opportunities. They are not incentivized to dig deeper into why issues keep recurring.
A transformation partner, on the other hand, behaves like a strategic advisor that brings to light the real issues – the ones that never show up in dashboards or status reports. It steps back and assesses the entire technology ecosystem of the portfolio company to identify areas where outdated systems, security vulnerabilities or inefficient code impact performance, increase risk and limit scalability. It not only remediates gaps but also actively invests in elevating the existing technology stack to make it future-ready.
Differing Mandates: The Why vs the What
Tactical vendors focus on what’s in scope, what’s in the statement of work, what the key deliverables are and how many hours are billed.
A strategic transformation partner questions the “why”:
- Why are margins under pressure?
- Why is customer onboarding slow?
- Why are product launches consistently delayed?
It works closely with the portfolio company’s leadership to identify process bottlenecks, data silos, cost overrun areas and potential R&D inefficiencies. By speaking the language business leaders understand, a strategic transformation partner will map business issues (something is broken) back to root causes (what is causing the breakdown).
This allows the launch of targeted interventions that meaningfully improve EBITDA, customer experience and exit-readiness.
Technology as Value Multiplier at Exit
The gap between a tactical technology vendor and a strategic transformation partner becomes most obvious during an exit.
A tactical vendor may have kept systems running, performance benchmarks met and obvious chaos at bay. But that does not translate into buyer confidence or a premium valuation.
A strategic transformation partner, by contrast, works with the end in mind to ensure the technology stack is:
- Robust and secure
- Scalable and modern
- Clearly aligned with the company’s growth strategy
This shifts technology from a cost center that buyers might view as a risk to a clear driver of revenue growth, margin expansion and operational resilience.
Persistent as the Strategic IT Partner
A PE-owned, UK-headquartered SaaS giant with more than 200 products across eight sectors, was, in reality, a governance black hole.
Years of acquisition-led growth had created a tangle of competing products and siloed, unproductive R&D teams. Standard engineering KPIs were missing, margins were low and the professional services team was heavy and expensive.
This lack of visibility and efficiency made the asset toxic to potential acquirers. The PE firm struggled to sell.
Persistent’s Value-Add
To manage a product sprawl, the portfolio company needed to be AI-ready with nimble processes, deep observability and data engines to move from insights to action.
This was not a staff augmentation issue. This required a complete overhaul.
The PE firm teamed up with Persistent to bring previously siloed teams together into a single, flexible delivery model where people, skills and resources are shared across projects. This allows teams to be quickly reconfigured based on business needs, pivoting to a structure that supports faster experimentation, data sharing and cross-functional collaboration. We also worked to clean up underlying process bottlenecks and connect data to a centralized system that can support diverse functions.
We worked with product teams to identify the right modern architecture to meet ther needs and built a tech stack on cloud, unleashing automation, interoperability and secure access to data assets. This fungibility was crucial to turning the working model into an efficient and truly AI-ready operation.
Plugging this with a governance structure with standard KPIs measured actual output, targeting a lean 15% R&D-to-ARR ratio. Within weeks, the SaaS company shifted from supporting more than 200 siloed legacy tools to a unified platform that boosted efficiency across the board by 40%.
The Result
The impact went beyond the P&L. By rethinking the delivery model and governance structure, we transformed the narrative from “bloated legacy giant” to “efficient AI-ready growth platform.”
This operational cleanup was the key that finally unlocked a potential exit.
Creating Portfolio-Wide Insights
For many PE firms, one of the hardest challenges is fragmentation, especially after multiple add-on acquisitions. Each company runs its own tools, follows its own processes and engages its own vendors.
Tactical vendors, working independently at each asset, make this worse. A strategic transformation partner flips the approach by introducing:
- Standard governance frameworks
- Common definitions and KPIs
- Unified metrics for code quality, technical debt and operational efficiency
This portfolio-wide view compares assets on an apples-to-apples basis. It highlights which teams are most efficient, where technical debt is highest and which practices should be scaled across the portfolio. That visibility unlocks a continuous improvement loop and supports better investment and divestment decisions.
Persistent partners with PE firms to derive the value from their IT investments. As a strategic partner, we work with an outcome-based model, where our teams adopt the existing technology landscape with equal stakes in the game.
We embed AI-readiness, equipping portfolio companies to tap into productivity gains and compress time-to-market. Our approach prioritizes production-grade AI implementation, emerging from secure, responsible and transparent AI philosophy, accelerating business value realization and transforming IT into a strategic growth lever.
We drive this transformation through strong collaborations with leading hyperscalers and technology partners, including AWS, Google Cloud, Microsoft, OpenAI and NVIDIA, accelerating the journey to AI readiness with cloud-native architectures and modern data platforms underpinned by GenAI and intelligent agents.
To know how Persistent accelerates value creation across the portfolio, visit us here.
Author’s Profile
Ekansh Gupta
PE Strategy Lead
