AI companies hitch PE ride to reach enterprises

Synopsis

AI giants OpenAI and Anthropic are forging major joint ventures with private equity firms, injecting billions to accelerate AI adoption across enterprises. This strategic move positions them as direct competitors to traditional IT services companies, including India's tech giants, as they aim to capture the high-value strategy and transformation layer of AI deployment.

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OpenAI and Anthropic are tapping private equity firms as their distribution engine to embed AI services across enterprises, a model that will put them in direct competition with IT firms, including India’s biggest tech companies. This comes after the bleeding-edge AI enterprises launched coding platforms and language models that threaten India’s $300 billion IT services and consulting sector.

OpenAI was first off the blocks on Tuesday, announcing a $10 billion joint venture, The Deployment Company, backed by 19 investors, including TPG, Brookfield, Bain Capital, SoftBank and Dragoneer, collectively touching 2,000 portfolio companies. Hours later, Anthropic announced its own version, a $1.5 billion joint venture with Blackstone, Hellman & Friedman, Goldman Sachs and General Atlantic to sell Claude.

“The announcements signal that a clear objective is to accelerate AI strategy consulting and ‘build the business’ transformation work, rather than the ‘run the business’ work traditionally handled by IT services firms,” said Nitin Bhatt, technology sector leader at EY India.

AI companies are facing pressure to show revenue growth ahead of planned listings, whereas IT companies are still gathering the tech muscle to deploy frontier technologies. AI diffusion through legacy services companies has been slow. Therefore, private equity (PE) is emerging to bridge this gap by offering capital, lean talent, speed and more predictable return pathways, experts said.

“PE portfolios offer an attractive shortcut: a captive set of companies with clear mandates to deliver ebitda improvement over three-five year horizons, where AI is a powerful lever,” Bhatt said. “The guaranteed returns being offered to PE firms, reportedly 17.5% (by OpenAI), put real skin in the game and align incentives tightly.”

However, these joint ventures are likely to lean on IT companies for execution muscle as frontier AI firms capture the higher-value strategy and transformation layer. As a result, there could be cyclical revenue pressure on IT firms in the near term, Bhatt said.

This could be an opportunity rather than a threat, said Mohandas Pai, former chief financial officer and board member of Infosys.

“PE firms are investors and bring the capital edge needed for compute and research,” said Pai. “However, deployment tools like Claude Code or Codex are available uniformly to all. I don’t see this as any threat to IT companies' model; it’s just an initiative to grow revenues.”

India’s top IT firms including Infosys and HCLTech have said that AI is squeezing the topline.

Tata Consultancy Services (TCS), the country’s biggest IT company, reported an annual revenue decline of 2.4% in constant currency terms for FY26 for the first time since going public, while Wipro posted a drop for the third consecutive year, down 1.6%.

“Driving enterprise AI is critical to sustaining their growth momentum, and there isn't enough supply currently,” said Srikanth Velamakanni, chief executive at AI services firm Fractal Analytics and chairperson of India’s software industry grouping Nasscom, explaining why AI companies need the PE route.

He added that AI’s rapid progress over the last 12 months — moving beyond knowledge to reasoning and agentic capabilities — has led to vast deployment needs.

“The hyperscaler AI firms are moving up the value chain and targeting distribution by direct sales. Access to the PE portfolio companies is an add-on, benefit” said Ganesh Natarajan, chairman of GTT Data Solutions, and a former chairman of Nasscom. “This will be additional competition for IT firms who will need to use their wider integration services capabilities to collaborate and win market share. I believe the AI market is huge and there are growth opportunities for all players.”

In FY27, top firms such as TCS, Infosys, HCLTech, Wipro and Tech Mahindra are expected to post annual revenue growth of 2-5% on average, as per estimates by consultants Zinnov and UnearthInsight as well as domestic brokerages.

However, the services pie will continue to expand in the long term. Infosys chairman Nandan Nilekani has projected a $300-400 billion market opportunity in AI-first services by 2030.

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