AI Transformation Boosts Productivity at Vista's Portfolio Companies

In a recent interview, Robert F. Smith, the founder of private equity firm Vista, discussed the company's embrace of AI and generative AI to drive productivity and growth across its portfolio.

Over the past 25 years, Vista has been at the forefront of bringing enterprise software to the cloud. Now, the firm is focused on implementing the transition to artificial intelligence, which Smith believes will enable enterprise software to "eat services" and create significant efficiencies.

According to Smith, Vista has already installed AI-powered "agentic solutions" in 18 of its portfolio companies, resulting in substantial productivity gains. The firm has also built an "agentic factory" to help its companies leverage AI and create highly efficient workflows.

While there were reports that Vista planned to cut its workforce by as much as 30% due to AI, Smith clarified that the company is not reducing staff by that amount. However, he acknowledged that Vista may slow hiring in certain areas as AI automates certain tasks. The goal, he said, is to enable Vista's people to become more productive and expand their addressable markets.

Smith emphasized that the key to success in the AI era will be for enterprise software companies to maintain "sovereignty and dominion over workflows and data sets." Firms that can build agentic solutions around their unique workflows and data will be able to capture significant economic benefits, he said.

Looking ahead, Smith is excited about the prospects for Vista's portfolio companies, particularly as the IPO market begins to reopen. He believes that public investors are now seeking out companies with the ability to sustain growth and market share in specific enterprise software areas, which aligns with Vista's focus.