Core Insights - Private equity firms are increasing investments but are more selective, focusing on resilient sectors like technology, health care, and energy [1] - CFOs of portfolio companies are under pressure to be "exit-ready" and to implement AI-enabled finance capabilities [1] Group 1: Exit Readiness - Exit readiness involves being strategically prepared for a sale or public offering, emphasizing strong performance and operational improvements [2] - 97% of sponsors expect CFOs to maintain an "always exit-ready" posture, but only 20% of CFOs report doing so [3] - Most CFOs only shift to exit mode when a sale opportunity arises, which can negatively impact valuation by one to three turns of the exit multiple [3] Group 2: Definition of Exit Readiness - Sponsors define exit readiness as a holistic approach, including active value-creation levers and credible equity stories, while CFOs focus on tactical tasks [4] - Only 32% of CFOs include value creation in their definition of exit readiness [4] Group 3: Preparation Timeline - Over 80% of sponsors prefer exit preparation to start 12–24 months before a sale, but half of CFOs begin only three to six months prior [5] - Compressed preparation is linked to lower deal multiples, with 39% of sponsors citing rushed exits as a reason for post-sale adjustments [5] Group 4: Importance of AI - 85% of buyers now consider AI-enabled finance when valuing companies, with CFOs who integrate AI in financial processes being twice as likely to achieve smoother exits and higher valuations [6] - The rising importance of AI in finance is a significant trend impacting exit readiness and valuation [6] Group 5: Challenges Faced by CFOs - CFOs face challenges such as bandwidth constraints, fragmented systems, and unclear sponsor expectations, which directly affect valuation [7]