James Prebble, CEO of Palladium Digital, Shares His View
Private equity has always thrived on innovation, yet deal origination remains a stubbornly manual process. While generative AI is transforming areas like due diligence and portfolio management, its adoption in deal sourcing has been slow. As the technology matures, the question is becoming more urgent: can AI truly help private equity firms find their next great investment?
James Prebble, CEO and co-founder of Palladium Digital, offers his perspective on the opportunities and challenges AI presents for deal origination.
Why Hasn’t AI Taken Over Deal Sourcing?
From my vantage point at Palladium Digital, deal-sourcing is still a resource-heavy, time-consuming task. Origination teams spend hours combing the market, narrowing pipelines, and conducting deep due diligence. Given this, it’s surprising that AI hasn’t been more widely adopted for sourcing deals. Surveys as recent as 2025 show that less than a third of PE and VC firms have tried AI for origination, with most focusing on due diligence and portfolio management instead.
What’s Holding AI Back?
Despite the slow start, I’m seeing growing interest in AI for deal origination. Most origination teams I speak to are exploring how generative AI could make their work more efficient. However, there are real challenges. The technology is evolving rapidly, and while many AI platforms are marketed for PE origination, they struggle to keep pace with giants like Microsoft and Google. I expect most funds will soon favour solutions that integrate directly with their existing Office 365 or Google Suite environments.
The Data Dilemma
A major barrier is data quality. Even the best AI platforms are only as good as the data they access. Origination teams need more than just lists of companies—they need actionable insights, filtered by criteria like ownership, turnover, or geography. Without robust, structured data, AI’s value is limited. This is why many firms, including those in the lower mid-market, still rely heavily on manual processes.
People Still Matter
It’s crucial to remember that deal origination is fundamentally about relationships. No matter how advanced AI becomes, persuading business owners to engage will always require a human touch. That said, I believe AI will soon handle much of the data filtering and initial screening, allowing origination teams to focus on what they do best: building connections and closing deals.
The Road Ahead
How quickly private equity firms embrace AI for deal sourcing will shape their competitive edge. Early adopters will gain the most, but as the technology becomes standard, differentiation will depend on how well teams combine AI with proprietary data and relationship-building skills.
At Palladium Digital, I see the future of origination as a blend of smart technology and human expertise. The firms that succeed will be those that prompt, engineer, and augment AI with their own insights—while never losing sight of the importance of personal relationships.
This article is an excerpt from the full article, which can be found on PE Internationals Website. Follow the link below to visit the article on their site.
