Private equity firm Astorg says software businesses in its portfolio are already seeing teams operate at roughly three times their previous productivity – with improvements of up to 10x in specific development cycle times – but argues the bigger opportunity from AI will require companies to redesign how they operate.
The findings come from Astorg’s new white paper, Rebuilding the Product & Engineering Operating Model for the AI-First Era, drawing on two years of implementing AI across its portfolio.
Rather than focusing solely on rolling out AI tools to developers, Astorg argues businesses need to rethink the wider product and engineering operating model, including team structures, management layers, governance, budgeting and how productivity and returns are measured.
The firm highlights examples including portfolio companies Fenergo and Opus, where individual engineering workflows have reached 5x to 10x improvements in some areas, while Xceptor has moved from monthly to weekly release cycles.
Astorg says the productivity gains are also beginning to translate into measurable operating capacity. Its portfolio AI programme released about €8m of recurring capacity in 2025, with a further €8m targeted for 2026.
But the report argues that traditional software operating models can prevent companies from fully capturing those gains. As AI reduces the time needed to write, test and maintain code, Astorg says bottlenecks increasingly move elsewhere in the organisation – including product definition, decision-making, quality assurance and governance.
That means businesses need to consider changes extending beyond engineering teams, including flatter management structures, different team composition, AI-specific governance and compliance frameworks, and new approaches to budgeting as AI consumption becomes a variable production cost.
Astorg also argues conventional productivity measures may become less useful as AI adoption increases, requiring companies to develop better telemetry around AI usage, development performance, cost and return on investment.
The Paris-headquartered private equity firm manages €24bn of assets and has invested more than €19bn, including co-investments.
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