Private equity firms are holding record levels of dry powder but face growing pressure to deploy capital strategically amid economic uncertainty. At the same time, family offices and wealth managers are increasing their allocations to private markets, adding complexity to deal flow, due diligence, and reporting.
This environment has paved the way for artificial intelligence (AI) to revolutionize private markets—not by replacing human expertise, but by enhancing speed and precision in decision-making. AI is transforming key areas such as deal sourcing and portfolio management, evolving so rapidly that even its creators must continuously reassess its capabilities.
For private markets firms, AI’s most immediate benefit lies in streamlining traditionally time-consuming processes that have long created inefficiencies. Research from Bayes Business School shows that the average due diligence timeline has stretched to 203 days, up 64% from 123 days a decade ago. AI has the potential to dramatically shorten this timeframe, reducing months-long processes to mere weeks. In some cases, AI-powered tools can complete initial due diligence questionnaires in just a day, significantly accelerating deal execution and improving overall efficiency in private market investments.