Carveouts are supposed to unlock opportunity. But if you’ve ever managed one, you know the first weeks can feel like trying to drive a racecar with the parking brake on. Transition Service Agreements (TSAs) eat into returns, IT teams are trapped in firefights, and growth initiatives get shoved into the “later” pile.
It doesn’t have to be that way. When private equity firms treat IT not as a back-office burden but as a lever for value creation, carveouts transform from risk-laden transitions into scalable platforms that accelerate growth.
The Problem: TSA Dependency & MSP Firefights
Most carveouts begin under the shadow of a TSA, a costly but necessary bridge while the new entity builds its own IT. Every day under that TSA burns value, and the longer it drags on, the harder it is to execute the investment thesis.
To make matters worse, many MSPs play defense. They chase tickets, patch holes, and keep the lights on, but fail to stand up the scalable infrastructure a new business needs. Instead of preparing the business for Day 1 and beyond, IT becomes a bottleneck.
The Shift: IT as a Growth Lever
DYOPATH has seen the other side of this story. With a disciplined approach to carveouts, IT shifts from reactive to proactive, reducing TSA costs, ensuring compliance from Day 1, and laying a foundation that scales as the business grows.
Take the case of a financial services carveout from a global payments company we worked with. The PE sponsor faced aggressive compliance requirements and tight TSA deadlines. DYOPATH deployed a dedicated IT and cybersecurity team within six months, establishing independent infrastructure, standing up 24/7 SOC services, and meeting regulatory benchmarks from Day 1. The result? The carveout exited its TSA on schedule, avoided costly overruns, and gained an IT platform built to handle future bolt-on acquisitions.
In another instance, a multi-location HVAC services company backed by a global PE firm needed standardized IT across more than a dozen sites. Instead of piecemeal fixes, DYOPATH refreshed infrastructure at all locations, deployed managed detection and response, and implemented a scalable cloud architecture. As the firm executed add-ons, integration time shrank dramatically, turning IT into a repeatable playbook for growth.
What This Means for PE Firms
These stories show what happens when IT is treated as a core lever in the value-creation plan:
- Faster Day 1 Readiness: Independent systems, security frameworks, and collaboration platforms stood up before TSA deadlines.
- Reduced TSA Costs: Clear upfront planning and interim IT solutions cut costly dependency periods.
- Compliance Wins: Cybersecurity frameworks and identity management built in from Day 1, not bolted on later.
- Scalable Foundations: Modular IT architectures enable smoother tuck-ins and platform roll-ups.
- EBITDA Impact: Lower operating costs and faster synergy capture directly improve margins.
The Takeaway
Carveouts don’t have to be an endless cycle of firefights. With the right MSP partner, IT can be the difference between a costly transition and a competitive edge. By standing up disciplined, scalable IT from Day 1, PE firms not only accelerate TSA exits but also create a foundation for add-on integrations, compliance assurance, and EBITDA uplift.
At DYOPATH, we help you build the growth engine your portfolio companies need.
Ready to stop burning cash on TSAs and start creating value? Talk to a DYOPATH expert about your next carveout!
