Artificial intelligence is being misapplied by executives who treat it as a technology rollout rather than a fundamental rethink of how businesses operate, Bain Capital Managing Partner David Gross said in a Bloomberg TV interview.

“We are extremely excited about it,” Gross said. “We’re also daunted by it just given the rapid pace of change.”

The risk, he said, is that companies and investors approach AI from the wrong starting point. The biggest mistake is beginning with the technology rather than the business objective.

“People are so fascinated by the technology, that it’s so easy to use that you start using it, then you say I need to change this and I need to change that,” Gross said. Instead. he thinks, it should be the reverse, starting with the business objective and then determining how the technology enables it.

The shift is already reshaping how work gets done. Much of AI’s near-term impact lies in automating knowledge-intensive, data-heavy tasks, pushing companies to rethink how talent is deployed rather than simply adding headcount, according to Gross.

“It has tremendous productivity potential,” Gross said. “The default answer when faced with growth is not always now to add people; it is to actually to think about the process and where technology and people can be deployed in an intertwined way to really drive the value.”

While that transition is likely to create dislocation in parts of the workforce, Gross said it will also unlock new categories of services that do not yet exist. At the same time, a shortage of talent capable of translating AI’s raw capabilities into operational change is emerging as a key bottleneck to adoption.

Private equity and private capital firms are increasingly positioned to help close that gap by pairing capital with execution. “They have an important seat at the table and can drive transformative change,” Gross said.

Bain is leaning into that shift, investing in capabilities tied to artificial intelligence while maintaining a broad, performance-focused strategy across asset classes. Growth, Gross said, is increasingly defined by talent and execution rather than scale alone.

Bloomberg News reported in March that OpenAI is in advanced talks to establish a joint venture with private equity firms including TPG Inc. and Brookfield Asset Management as well as Bain Capital. The venture would focus on accelerating adoption of OpenAI’s software

Gross also pointed to the broadening of private markets as a structural trend, as individual investors push for access to long-term assets historically reserved for institutions. “Democratization is obviously not a bad word — it implies a leveling and some access,” he said.

But expanding access brings new risks, particularly around expectations for liquidity. “There’s an assumption that liquidity will always be available—but what does liquidity really mean?” Gross said. In volatile markets, excessive redemption flexibility can force managers to sell assets at inopportune times, contributing to the rise of semi-liquid structures designed to balance access with stability.

That tension is becoming more pronounced as private credit and other alternative assets reach a broader investor base, with redemption pressures prompting closer scrutiny of fund design. The real goal is generating returns and managing the portfolio, Gross said.

Exit routes are also evolving. IPO markets have become less reliable amid elevated volatility, making listings harder to time and less attractive, according to Gross. In their place, sovereign wealth funds and pension funds are playing a larger role as providers of capital and liquidity.

Against that backdrop, Gross said deal activity “in the first half has been solid,” though geopolitical events could interfere with the outlook. “We are seeing pretty good continued trends,” he added.

(Updates with OpenAI talks to form joint venture in 10th paragraph.)

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