Private equity is facing one of its most challenging operating environments in years. Dealmaking has slowed, exits continue to be challenging, and fundraising is under pressure. According to a recent piece in the Wall Street Journal, firms are holding a record number of portfolio companies—nearly 29,000 globally—with a combined value of $3.6 trillion. Half of those assets have been owned for five years or longer. Operational excellence, powered by strong leadership, has become a defining advantage for firms in today’s environment.
Private equity firms are rethinking what drives returns — and talent is moving to the top of the list. That was the message from a panel of leadership and talent experts at the recent Private Equity International Human Capital Management conference. Our Council Advisors colleagues at TMG and SSA & Company joined the conversation, led by TMG’s Courtney Hamilton, featuring panelists Kim D’Aversa (Bregal Sagemount), Andrew Lim (Blackstone), and David Baker (Pritzker Private Capital).
Discussion centered around a key point, noting that the evolving role of the talent partner reflects a defining shift: value is created where talent meets execution. As portfolio demands grow more complex, the role of the talent partner is undergoing a quiet but profound evolution. Today’s talent partners are stepping onto the main stage — shaping strategy, influencing outcomes, and becoming essential members of the deal team. Once defined by discrete activities like executive search or assessments, talent leadership today is emerging as an essential strategic lever across every phase of the investment lifecycle.
Three clear shifts are reshaping the talent partner archetype:
1. Talent as a core pillar of value creation
Firms that treat leadership as a late-stage fix are falling behind. Talent is now integrated into value creation plans from the start, with partners identifying leadership risks and opportunities as early as diligence. Where talent was once seen as a supporting function, it is now recognized as a critical factor in generating returns. Leading firms are embedding talent partners early — from diligence through exit — to identify leadership gaps, build stronger management teams, and create operational lift.
2. From point solutions to enterprise builders
As the PE landscape evolves, panelists agreed that the most impactful talent partners aren’t just specialists in search, assessment, or benefits. They bring a broader playbook — bring broad experience across leadership assessment, organizational design, and succession planning. Their value comes from connecting these threads to scale a business holistically, not just solving isolated problems.
3. Talent partners are business partners
The future of the role looks less like HR and more like strategy. Today’s high-performing talent partners sit alongside investment teams to help shape investment theses, assess leadership teams during due diligence, and build long-term talent strategies post-close. Those who can move fluidly across phases are becoming indispensable to winning and growing deals.
The takeaway? As the panelists agreed, the talent partner’s role is evolving in many PE firms, shifting from functional expert to business strategist. Firms willing to treat talent as a core lever – not a box to check – are more likely to find a decisive edge in a crowded market.