Key IT Challenges Affecting Exits
IT systems have emerged as a pivotal factor in the success—or failure—of private equity (PE) exits in 2024 and 2025. Several technology-related hurdles and opportunities are shaping the exit environment:
1. IT as a Deal Maker—or Breaker
- Significant impact: 1 in 5 PE professionals report that technology issues have been a deal breaker in M&A processes, underlining the centrality of IT readiness to successful exits.
- Proactive focus: 93% of PE respondents state that technology challenges are now proactively addressed during exit planning and diligence.
2. Cybersecurity & Resilience
- Priority issue: 60% of PE leaders rank cybersecurity among their top three technology concerns during exit preparation.
- Resilience requirements: Over 75% prioritize the resilience of IT platforms to ensure business continuity and investor confidence.
3. Legacy Systems and Scalability
- Scalability barriers: Outdated or end-of-life systems limit scalability and impose security risks—both red flags for prospective buyers.
- Modernization imperative: Lack of modern, rightsized, and scalable IT infrastructure can depress exit valuations and prolong holding periods.
4. Data Integrity, Reporting & Analytics
- Reporting gaps: 76% of respondents view robust finance, reporting, and consolidation capabilities as critical for ensuring clean and efficient exits.
- Data-driven deals: As digital and AI strategies become more mainstream, buyers expect demonstrable analytics capabilities and clear data histories.
5. Digital Enablement & Automation
- Process automation: Overreliance on manual systems can threaten operational efficiency, slow integration with acquirers, and necessitate expensive upgrades pre-exit.
- AI & digital strategies: Alignment of IT roadmaps with business and digital transformation strategies is now seen as a core enabler of value creation and exit attractiveness.
6. Visibility on IT Investments
- Upcoming investment clarity: 78% of PE professionals want full visibility on future technology investments needed to maintain competitiveness and support growth post-exit.
Recent Industry Data & Opinions
| Factor | Reported Priority (%) | Implications for Exits |
| Proactively address IT in M&A | 93 | Early challenge mitigation increases exit readiness |
| Tech as deal breaker | 20 | Can prevent sales or reduce exit multiples |
| Cybersecurity in top-3 concerns | 60 | Must be demonstrably secure to avoid discount/risk |
| Tech resilience as top priority | 75 | Ensures continuity, boosts buyer confidence |
| Reporting systems as priority | 76 | Clean, auditable data is essential for diligence |
| Clarity on upcoming IT needs | 78 | Avoids post-transaction surprises for buyers |
Conclusion
Strong, modern, and resilient IT systems are no longer optional—they are fundamental for maximizing exit value in the current private equity climate. Major weaknesses, such as outdated core systems, gaps in cybersecurity, or insufficient automation, can derail deals, reduce valuations, or extend holding periods. Conversely, robust IT infrastructure, clear digital strategies, and advanced data capabilities are increasingly seen as value enhancers, making portfolio companies far more attractive to buyers and smoothing the path to exit.