Private equity deal volume has fallen sharply over the past two years, and firms are holding portfolio companies longer as a result. That puts more pressure on value creation during the hold period, from tighter financial operations to faster cash conversion. Neal McNamara, CEO of Virtas Partners, helps PE owners and their portfolio companies meet that pressure. Increasingly, his firm does it with AI solutions built for finance teams, in addition to its advisory work.
RapidCanvas produces the Vision Builders video series to capture how business leaders are rethinking their companies around AI. Neal’s episode looks at professional services, an industry where nearly every firm now claims an AI practice.
Virtas is a boutique Office of the CFO advisory firm serving middle-market companies, with much of its work done for private equity owners and their portfolio companies. Neal started the firm from scratch with one other person nine years ago and bootstrapped it into a scaled boutique with remarkable client retention. Neal also hosts a podcast called Consulting Uncensored.
The host for this episode is Ray Hsu, VP and General Manager at RapidCanvas. Ray’s background spans software development, project management, and business development across a wide range of industries, with a strong focus on practical AI solutions for manufacturing and supply chain businesses.
Here are some of the topics they cover in this very wide-ranging conversation.
From advisor to builder
Two years ago, Virtas began working with RapidCanvas to build proprietary tools that would help its consultants work faster. The partnership has since grown well beyond that. Virtas and RapidCanvas now develop AI solutions for its clients inside existing engagements and have begun licensing that technology. Neal explains why he once considered that outcome a long shot and what it has meant for a firm built on advisory work.
Private equity changes the consulting model
When Neal founded Virtas, almost no consulting firm anyone had heard of had taken institutional capital. Today he can’t name a direct competitor that hasn’t. Investor capital brings growth targets, and growth targets push firms toward acquisitions and bolt-on service lines that stretch what they’re known for. Neal shares the advice a peer gave him about protecting a firm’s core, and why he sees risk for clients when consultants grow too fast.
Everyone is an AI consulting firm now
Consulting has chased new practice areas before, from Sarbanes-Oxley compliance to ESG, and some of those bets have aged better than others. AI is the latest rush, with the largest firms competing for big transformation mandates. Neal describes where he thinks the real opening lies for firms that pair advice with AI-native development and stay independent of any single platform. Ray adds that AI is shrinking the time it takes to build sophisticated solutions, putting tailored tools within reach of mid-market companies that couldn’t justify them before.
What AI success looks like
Handing every employee an AI assistant is a starting point, but Neal believes too many companies stop there. Real returns come from removing the manual bottlenecks that slow the monthly close, billing, and collections, where faster cash conversion creates measurable value. Neal also explains why the right solution today may look different six months from now. He’s candid that keeping pace will overwhelm some leaders, and he makes the case that falling behind is the bigger danger. Ray connects the dots: deliver a string of quick wins, and you drive both transformation and near-term ROI. He describes how a sound strategy prioritizes solutions and enables them to utilize a shared context.
The case against the ERP project
ERP implementations are expensive and slow, and most need close to a decade to pay off. Private equity owners typically plan to sell within five years. Neal describes conversations with CFO operating partners who are rethinking the math, including one who has taken a firm position across an entire portfolio. Ray notes that a solid ERP foundation is seldom what drives a company’s growth or profit. The opportunity is in leveraging the information that companies already have for focused implementations that deliver value in weeks instead of years.
Watch the interview now to hear where consulting is headed and what middle-market leaders should do about it.
