Talent Is the Asset: Why PE Firms Are Rethinking What They’re Really Buying

A New Era of Private Equity: Talent as the Competitive Edge

This week, two headline-grabbing deals spotlighted where capital is flowing: KKR acquired a majority stake in HealthCare Royalty Partners, and Palo Alto Networks is nearing a $20 billion acquisition of cybersecurity firm CyberArk.

At first glance, these moves look like classic sector plays: one in life sciences, one in cybersecurity. But there’s a deeper common thread that tells us more about where private equity is headed. Both businesses are deeply talent-driven. Their value does not live in physical infrastructure or fixed IP. It lives in people.

Increasingly, this is the nature of the modern private equity deal. Investors are not just buying asset-rich companies characterized by high free cash flows. They are acquiring teams, capabilities, and organizational know-how. Yet many still lack clear visibility into the workforce they’re inheriting.

Want to see how leading investors are de-risking deals with real-time workforce insights? Explore Aura’s private equity solutions.

The Rise of Talent-Intensive Deal Flow

Private equity activity is shifting toward sectors where human capital is the core value driver. This isn’t just anecdotal. The data supports it.

• Professional services, software, and healthcare, three of the most talent-centric industries, have seen a sharp rise in PE interest.

• Bain & Company, as cited in a 2021 MedPAC report to Congress, found that private equity buyouts of healthcare providers in North America totaled $46.7 billion in 2019, up from $29.6 billion in 2018. Approximately 60 percent of that deal volume came from labor-intensive segments such as home health, behavioral health, hospice, and physician groups.

• In Bain’s 2025 Global Private Equity Report, 58% of value creation in software buyouts between 2014 and 2024 came from operational execution, areas like product scaling, sales execution, and margins, underscoring how talent and organizational capability are now primary levers of success.

• According to survey findings discussed by Hunt Scanlon Ventures, leadership quality is cited as the number one driver of deal success, while unmanaged talent risk is the second most cited cause of portfolio underperformance. More than 90% of PE professionals surveyed acknowledged that delaying decisions on top-tier talent led to missed value creation.

• According to PitchBook’s Q1 2025 U.S. PE Middle Market Report, healthcare and technology together accounted for over 60% of mid-market PE deal volume in North America. These sectors—especially IT services, healthcare platforms, and consulting—tend to be highly talent-dependent, with workforce quality playing a central role in operational performance.

Put simply, dealmakers are more often buying organizations where value is tied directly to talent. Yet most diligence processes are still optimized for financial statements and market sizing, not for organizational structure, talent risks, or capability gaps.

The Blind Spot in Traditional Diligence

Investors know how to analyze revenue breakdowns, customer churn, and EBITDA margins. But they often lack clarity on the asset that drives all of it: the workforce.

Traditional diligence cannot answer questions like:

• How is headcount distributed across functions, regions, and subsidiaries?

• Are key teams growing, shrinking, or turning over?

• Is the company over-indexed on legacy skills in a market moving toward AI?

• How integrated is the finance or product function across business units?

• Is the leadership team stable or at risk of departure?

These are not soft questions. They are operational red flags and opportunity signals that affect valuation, synergy realization, and time to value.

How Aura Turns Workforce Data into Deal Intelligence

Aura was built to close this gap. Our AI-powered data platform provides outside-in workforce intelligence across more than 20 million public and private companies. We analyze over 1 billion data points, from job postings and professional profiles to sentiment reviews and team structures.

In M&A and private equity use cases, we help clients:

• Benchmark functional headcount, productivity ratios, and hiring trends

• Evaluate leadership depth and org design stability

• Track attrition, mobility, and skills evolution by geography and function

• Identify integration risks tied to fragmented teams or misaligned operating models

And we do this in real time, through self-serve dashboards or curated data feeds, so strategy teams can move with speed and confidence.

What the Best Firms Are Doing Differently

The smartest investors are rethinking diligence. They are supplementing traditional financial analysis with workforce intelligence to pressure-test assumptions about scalability, talent risk, and post-close transformation.

In fact, over 500 consulting and investing teams have used Aura in the past year to:

• Improve diligence efficiency and reduce analysis costs

• Uncover cost-saving opportunities and organizational inefficiencies

• De-risk integration by proactively assessing team structure and overlap

• Support portfolio monitoring with frequently updated hiring and attrition data

The most forward-looking teams are no longer treating people data as a lagging indicator. They are putting it at the center of their decision-making.

Why Workforce Visibility Is Now a PE Imperative

Deals like CyberArk and HCRx reflect a broader shift in what buyers are really purchasing. The playbook is no longer just about acquiring assets or distribution. It is about acquiring skills and capabilities that scale, which reside in people.

If you cannot see the structure, health, and readiness of the workforce you are about to acquire, you are operating blind. You are also missing a significant opportunity to differentiate in a competitive market.

Aura gives investors and strategy teams the visibility they need to make better decisions. When talent is the asset, we ensure you fully understand it before the deal is finalized.

Make talent your edge in the next deal.

See how Aura helps top private equity and M&A teams unlock workforce intelligence before the ink dries. Request a demo today.