How PE Firms Are Using AI to Drive Operational Efficiency
Jan 28, 2026Private equity firms see continued opportunity in the industries that serve as the backbone for AI transformation. Major PE players are making substantial investments in data centres, energy producers, semiconductor manufacturers, and network hardware suppliers to fuel AI expansion. These categories are capital-intensive, but they tap into measurable, long-term market demand.
US data centres consumed more than 4% of the country's total electricity in 2023, and by 2030, that figure could increase to 9%.[1]
By focusing on AI infrastructure and adjacent assets, PE firms are positioning for durable, cash-flow-oriented growth that aligns with both government incentives for domestic manufacturing and corporate spending on AI. In a sector prone to hype, these enabler investments offer resilience and are less susceptible to short-term speculation.
PE Firms Investing Billions in AI Infrastructure
The scale of private equity investment in AI infrastructure is unprecedented. Blackstone announced a $25 billion investment in Pennsylvania's digital and energy infrastructure in 2025, with the project expected to catalyse an additional $60 billion in investment and create over 6,000 construction jobs annually.[2]
Firms like BlackRock and Blackstone have invested nearly $200 billion in data centre-related deals since 2022, driving acquisitions across power plants, energy assets, and data centre operators.[3]
In semiconductor manufacturing, Apollo Global Management led a consortium committing $750 million in financing to Wolfspeed, a leading producer of silicon carbide technology critical for AI hardware.[4]
AI Transforming PE Fund and Portfolio Management
Private equity's interest in AI extends beyond sector strategy and deal sourcing. Firms are actively exploring how they can leverage AI for fund and portfolio company management. They are embracing AI applications across the investment lifecycle, from AI-enabled deal sourcing to AI-powered due diligence, fraud detection, portfolio monitoring, and standardised reporting.
According to Bain & Company's research, nearly 20% of portfolio companies have operationalised generative AI use cases and are seeing concrete results. Meanwhile, 60% of PE companies have portfolio companies experimenting with generative AI.[5]
A Deloitte survey found that 65% of private equity executives are either piloting or fully implementing AI in investment decision-making, citing improved deal sourcing efficiency as the top benefit.[6]
The productivity gains are substantial. McKinsey estimates that AI could improve deal origination productivity by up to 30%, freeing partners and analysts to focus on strategic negotiations rather than manual data collection.[7]
Some firms report up to 70% reduction in manual due diligence hours through AI-assisted document parsing, anomaly detection, and comparative analytics.[8]
2026: The Year AI Becomes a Competitive Differentiator
Global PE dealmaking rose 14% to $2 trillion in 2024, making it the third-most-active year on record for the asset class. Building on this momentum, 2025 is expected to see continued activity driven in part by advancements in AI technologies and investment in digital infrastructure.[9]
With dry powder in tech-focused funds sitting at $476 billion globally at the end of 2024, there's a growing recognition that raising the next fund will likely depend on demonstrating AI capabilities.[10]
Across all these use cases, AI is speeding up execution and raising the quality of decision-making. Many firms will build on their AI capabilities in 2026, integrating them more deeply into fund and portfolio company management strategies. Those that do will see AI emerge as a core competitive differentiator in the crowded PE landscape.
"As much as this technology is so exciting, unless we get the energy side right, we can't pursue this... private capital will be a really important part of the answer."
— Jonathan D. Gray, President and COO, Blackstone[4]
The Bottom Line for PE Firms
Private equity's AI strategy is two-fold: invest in the infrastructure powering AI transformation, and deploy AI tools internally to drive operational efficiency. Firms that master both dimensions will capture outsized returns. Those that treat AI as a peripheral initiative risk falling behind as the technology reshapes deal origination, due diligence, and portfolio value creation.
The firms moving fastest are already seeing concrete results. The question isn't whether to adopt AI—it's how quickly you can scale it across your investment lifecycle.
Frequently Asked Questions
How are private equity firms using AI for operational efficiency?
PE firms are deploying AI across the investment lifecycle, from AI-enabled deal sourcing and due diligence to portfolio monitoring and standardised reporting. AI tools help reduce manual diligence hours by up to 70% through automated document parsing, anomaly detection, and comparative analytics.
What percentage of portfolio companies are using AI?
According to Bain & Company's 2025 Global Private Equity Report, nearly 20% of portfolio companies have operationalised generative AI use cases and are seeing concrete results, while 60% of PE companies have portfolio companies experimenting with AI.
Why are PE firms investing in data centres and AI infrastructure?
Data centres are capital-intensive but tap into measurable, long-term market demand. The Electric Power Research Institute estimates data centres could consume up to 9% of US electricity by 2030, up from 4% in 2023. These infrastructure investments offer durable, cash-flow-oriented growth less susceptible to hype cycles.
How much are PE firms investing in AI infrastructure?
Major PE firms have invested nearly $200 billion in data centre-related deals since 2022. Blackstone alone announced a $25 billion investment in Pennsylvania's digital and energy infrastructure in 2025, expected to catalyse an additional $60 billion in investment.
Will AI become a competitive differentiator for PE firms?
Yes. PE firms that integrate AI capabilities deeply into fund and portfolio company management strategies will see AI emerge as a core competitive differentiator. McKinsey estimates AI could improve deal origination productivity by up to 30%.
Sources
- Electric Power Research Institute (EPRI), "Powering Intelligence: Analyzing Artificial Intelligence and Data Center Energy Consumption," May 2024. https://www.epri.com
- Blackstone, "Blackstone to Invest More Than $25 Billion in Pennsylvania's Digital and Energy Infrastructure," Press Release, July 2025. https://www.blackstone.com
- Private Equity Stakeholder Project, "From Power Plants to Processors: Private Equity's Big Bet on the Data Center Pipeline," November 2025. https://pestakeholder.org
- American Investment Council, "Private Investment Continues to Fuel AI Innovation Across the Country," July 2025. https://www.investmentcouncil.org
- Bain & Company, "Field Notes from the Generative AI Insurgency," 2025 Global Private Equity Report. https://www.bain.com
- Deloitte, "2024 Private Equity Survey," cited in SmartDev, "AI in Private Equity: Top Use Cases," September 2025. https://smartdev.com
- McKinsey & Company, "A Clear-Eyed View of Gen AI for the Private Equity Industry," August 2024. https://www.mckinsey.com
- Konzortia Capital, "From Discovery to Exit: How AI Is Redefining Deal Sourcing Efficiency," October 2025. https://konzortiacapital.com
- McKinsey & Company, "Global Private Markets Report 2025," May 2025. https://www.mckinsey.com
- Bain & Company, "Technology Report 2025: AI Leaders Are Extending Their Edge." https://www.bain.com
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