{"id":393329,"date":"2026-03-18T15:03:55","date_gmt":"2026-03-18T15:03:55","guid":{"rendered":"https:\/\/riveron.com\/?p=393329"},"modified":"2026-03-18T15:03:55","modified_gmt":"2026-03-18T15:03:55","slug":"turning-ai-from-hype-to-habit-in-mid-market-private-equity","status":"publish","type":"post","link":"https:\/\/newriveron.ituldev.com\/?p=393329","title":{"rendered":"Turning AI From Hype to Habit in Mid-Market Private Equity"},"content":{"rendered":"<blockquote><p><span class=\"TextRun SCXW6153545 BCX0\" lang=\"EN-US\" xml:lang=\"EN-US\" data-contrast=\"auto\"><span class=\"NormalTextRun SCXW6153545 BCX0\">Human checkpoints\u00a0<\/span><span class=\"NormalTextRun SCXW6153545 BCX0\">remain<\/span><span class=\"NormalTextRun SCXW6153545 BCX0\">\u00a0a vital step in the AI adoption process.<\/span><\/span><span class=\"EOP SCXW6153545 BCX0\" data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559685&quot;:5040,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240,&quot;335572079&quot;:6,&quot;335572080&quot;:1,&quot;335572081&quot;:0,&quot;469789806&quot;:&quot;single&quot;}\">\u00a0<\/span><\/p><\/blockquote>\n<p><span data-contrast=\"auto\"><i>A version of these insights first appeared in <a href=\"https:\/\/www.forbes.com\/councils\/forbesfinancecouncil\/2025\/12\/11\/turning-ai-from-hype-to-habit-in-mid-market-private-equity\/\" target=\"_blank\">Forbes Finance Council<\/a><\/i>. In the race to create value, private equity firms face pressure on all fronts, especially in the middle market. There, portfolio companies (portcos) are\u00a0operating\u00a0with leaner teams, tighter\u00a0budgets\u00a0and fewer in-house resources\u2014all while facing the same expectations for speed and insight as their larger rivals.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Artificial intelligence has become a clear differentiator for midsized companies\u00a0seeking\u00a0to gain an edge over their competitors. Beyond improving cash visibility, scenario planning and portfolio monitoring, AI is unlocking new dimensions of efficiency and strategic insight across the investment life cycle.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Despite its benefits, the journey to transform AI from hype to an everyday tool is easier said than done. Firms must develop a pragmatic road map for AI implementation. Drawing on my experience in middle-market private equity,\u00a0I\u2019ll\u00a0outline practical guidance for sponsors and management teams, what to prioritize first, what to avoid and how to effectively balance building versus buying technology solutions.<\/span><\/p>\n<h2><b><span data-contrast=\"auto\">Start Smart: A Prioritization Lens\u00a0For\u00a0Mid-Market PE<\/span><\/b><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/h2>\n<p><span data-contrast=\"auto\">Typically, the hardest part of any project is getting started. The same rings\u00a0true\u00a0for AI investment. When advising private equity clients on any major undertaking, I always recommend starting with areas that are hemorrhaging cash or have a high readiness for innovation. Newly\u00a0acquired\u00a0portcos\u00a0often present immediate opportunities for transforming the office of the CFO through technology. The following use cases could be a strong starting point for mid-market organizations:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<ul>\n<li aria-setsize=\"-1\" data-leveltext=\"\u2022\" data-font=\"Verdana\" data-listid=\"6\" data-list-defn-props=\"{&quot;134224900&quot;:true,&quot;335551671&quot;:0,&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Verdana&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u2022&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" data-aria-posinset=\"0\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Rapid document intelligence for contracts, customer\u00a0cohorts\u00a0and churn drivers:<\/span><\/b><span data-contrast=\"auto\">\u202fAI can ingest and synthesize information in real time.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li aria-setsize=\"-1\" data-leveltext=\"\u2022\" data-font=\"Verdana\" data-listid=\"6\" data-list-defn-props=\"{&quot;134224900&quot;:true,&quot;335551671&quot;:0,&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Verdana&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u2022&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" data-aria-posinset=\"1\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Key performance indicator (KPI) normalization across targets:<\/span><\/b><span data-contrast=\"auto\">\u202fAI provides automated mapping of metrics, revenue\u00a0buckets\u00a0and data definitions, enabling deal teams to compare apples to apples from the outset.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li aria-setsize=\"-1\" data-leveltext=\"\u2022\" data-font=\"Verdana\" data-listid=\"6\" data-list-defn-props=\"{&quot;134224900&quot;:true,&quot;335551671&quot;:0,&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Verdana&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u2022&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" data-aria-posinset=\"2\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">AI-assisted cash-flow forecasting:<\/span><\/b><span data-contrast=\"auto\">\u202fUse historical patterns and external signals to tighten visibility and reduce forecasting errors.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li aria-setsize=\"-1\" data-leveltext=\"\u2022\" data-font=\"Verdana\" data-listid=\"6\" data-list-defn-props=\"{&quot;134224900&quot;:true,&quot;335551671&quot;:0,&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Verdana&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u2022&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" data-aria-posinset=\"3\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Accounts payable and journal-entry anomaly flags:\u202f<\/span><\/b><span data-contrast=\"auto\">AI can catch duplicate invoices,\u00a0approval\u00a0bottlenecks\u00a0and unusual entries before they appear in profit-and-loss statements.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/li>\n<\/ul>\n<p><span data-contrast=\"auto\">Sponsors and management teams must thoughtfully assess where AI can deliver the greatest impact, recognizing that some functional areas require substantial data preparation before an AI solution can be both valuable and reliable. Many mid-market companies\u2014particularly those backed by private equity\u2014face structural data challenges that complicate this effort, most notably the reliance on multiple, disconnected\u00a0<\/span><a href=\"https:\/\/riveron.com\/services\/technology-enablement\/erp\/\"><span data-contrast=\"none\">enterprise resource planning (ERP) systems<\/span><\/a><span data-contrast=\"auto\">\u00a0and databases that make building a unified dataset\u00a0nearly impossible.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">These issues are often compounded by inconsistent coding across business units, which undermines\u00a0accurate\u00a0financial grouping and analysis. In addition, an overdependence on super spreadsheets for critical business processes means that core logic and data validation\u00a0reside\u00a0outside any auditable system, creating instability and risk in the data foundation\u00a0required\u00a0for effective AI training.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Once a stable data foundation is\u00a0established, there are many other reliable possibilities to create value using AI, including:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<ul>\n<li aria-setsize=\"-1\" data-leveltext=\"\u2022\" data-font=\"Verdana\" data-listid=\"6\" data-list-defn-props=\"{&quot;134224900&quot;:true,&quot;335551671&quot;:0,&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Verdana&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u2022&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" data-aria-posinset=\"4\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Predicting and\u00a0optimizing\u00a0inventory:\u202f<\/span><\/b><span data-contrast=\"auto\">Use deterministic modeling to analyze historical sales,\u00a0seasonality\u00a0and external factors to predict exactly how much stock is needed.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li aria-setsize=\"-1\" data-leveltext=\"\u2022\" data-font=\"Verdana\" data-listid=\"6\" data-list-defn-props=\"{&quot;134224900&quot;:true,&quot;335551671&quot;:0,&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Verdana&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u2022&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" data-aria-posinset=\"5\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Achieving labor and scheduling efficiencies:\u202f<\/span><\/b><span data-contrast=\"auto\">Deploy automated tools to forecast staffing needs based on customer demand, allowing management to\u00a0optimize\u00a0shift schedules.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li aria-setsize=\"-1\" data-leveltext=\"\u2022\" data-font=\"Verdana\" data-listid=\"6\" data-list-defn-props=\"{&quot;134224900&quot;:true,&quot;335551671&quot;:0,&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Verdana&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\u2022&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" data-aria-posinset=\"6\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Detecting fraud and errors:<\/span><\/b><span data-contrast=\"auto\">\u202fImplement AI to\u00a0monitor\u00a0all financial transactions and employee expense reports, flagging unusual patterns or duplicate invoices often missed during human review.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/li>\n<\/ul>\n<h2>To Build\u00a0or\u00a0to Buy\u00a0AI Capabilities?<\/h2>\n<p><span data-contrast=\"auto\">Once firms have pinpointed where to start their AI journey, they must decide whether to buy via\u00a0acquiring\u00a0a company with an existing AI advantage or to build by mobilizing an operations-focused strategy. Whether CFOs and other business leaders are overseeing the rollout of traditional or\u00a0cutting-edge\u00a0technology solutions, the core build-or-buy analysis\u00a0remains\u00a0the same: Define the problem, evaluate\u00a0implementers\u00a0and conduct a cost-benefit analysis.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">But finance leaders cannot ignore the significant complexity added by AI. Unlike a static software product, AI is a dynamic capability that requires continuous integration and data management. Success hinges on a company&#8217;s data readiness, the availability of specialized\u00a0talent\u00a0and the ability to manage rapid technological advancements.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Acquiring\u00a0a\u00a0portco\u00a0with a proven AI solution offers a direct path to market and a rapid value-add. This strategy aligns with a deal-focused approach, which demands rigorous due diligence on the model&#8217;s performance, data\u00a0quality\u00a0and intellectual property (IP) ownership to avoid buying significant technological debt. Developing AI in-house allows for a custom-built solution precisely aligned with the firm&#8217;s value-creation thesis. While choosing to build is more capital and time-intensive, it can create a powerful, proprietary advantage that can be scaled across other\u00a0portcos.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<h2>Governance That Makes AI Work<\/h2>\n<p><span data-contrast=\"auto\">Risk and controls are\u00a0arguably the\u00a0most important part of the AI implementation process, whether a company chooses to build or buy the capability. Human checkpoints\u00a0remain\u00a0a vital step in the AI adoption process. This includes\u00a0establishing\u00a0decision thresholds where a person must review outputs, defining escalation paths for\u00a0exceptions\u00a0and continuously\u00a0validating\u00a0that the model is performing as intended. Without this governance backbone, even the best AI use case can introduce new risks or undermine trust across the organization. And, since the governance, risk, compliance (GRC) landscape for new AI technology is\u00a0relatively immature, it is helpful to engage seasoned governance and risk advisors who have ample experience helping similar companies navigate high-velocity change. This will help the organization\u00a0establish\u00a0compliant guardrails at the necessary pace.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">AI is no longer a nice-to-have for mid-market private equity firms. To reduce costs, enhance efficiency and remain competitive with larger\u00a0peers,\u00a0firms and their portfolio companies must embrace\u00a0new technologies\u00a0before the gap becomes too wide to close. With a clear and disciplined approach, mid-market firms can transform AI from a buzzword into a habit and from a habit into a true competitive edge. Success starts by focusing on the areas that drive the greatest\u00a0financial impact,\u00a0maintaining\u00a0a targeted scope, managing inherent\u00a0risks\u00a0and demanding measurable, data-backed results.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559738&quot;:200,&quot;335559739&quot;:0,&quot;335559740&quot;:240}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Ultimately, the\u00a0firms that win in this new era will be those that view AI not as a project, but as a continuous capability, integrated into decision-making, embedded in\u00a0operations\u00a0and aligned with value creation at every stage of the investment life cycle.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Human checkpoints\u00a0remain\u00a0a vital step in the AI adoption process.\u00a0 A version of these insights first appeared in Forbes Finance Council. In the race to create value, private equity firms face pressure on all fronts, especially in the middle market. There, portfolio companies (portcos) are\u00a0operating\u00a0with leaner teams, tighter\u00a0budgets\u00a0and fewer in-house resources\u2014all while facing the same expectations &hellip; <a href=\"https:\/\/newriveron.ituldev.com\/?p=393329\">Continued<\/a><\/p>\n","protected":false},"author":2,"featured_media":391800,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[39],"tags":[59,138],"service":[],"solution":[],"content_type":[],"industry":[],"class_list":["post-393329","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-insights","tag-artificial-intelligence","tag-office-of-the-cfo"],"acf":[],"_links":{"self":[{"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=\/wp\/v2\/posts\/393329","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=393329"}],"version-history":[{"count":0,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=\/wp\/v2\/posts\/393329\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=\/wp\/v2\/media\/391800"}],"wp:attachment":[{"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=393329"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=393329"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=393329"},{"taxonomy":"service","embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fservice&post=393329"},{"taxonomy":"solution","embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fsolution&post=393329"},{"taxonomy":"content_type","embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcontent_type&post=393329"},{"taxonomy":"industry","embeddable":true,"href":"https:\/\/newriveron.ituldev.com\/index.php?rest_route=%2Fwp%2Fv2%2Findustry&post=393329"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}