Artificial intelligence has quickly become part of everyday business operations. From automating workflows to enhancing decision-making, most companies are now experimenting with, or actively using, AI in some form.

It’s therefore not surprising that many founders assume AI adoption will increase the value of their business.

In practice, however, the relationship between AI and valuation is far less straightforward.

Over the past two years, adoption has surged. Research from Wharton suggests that nearly 90% of companies are now using AI in at least one part of their organisation. Yet despite this widespread uptake, relatively few are seeing meaningful financial impact.

McKinsey’s State of AI report highlights that only a minority of businesses are generating tangible bottom-line results, while other data indicates that most companies still struggle to quantify the return on their AI investments.

This gap between adoption and impact is important. It suggests that while AI is now commonplace, it is not yet consistently translating into value.

In an M&A context, this distinction matters.

Technology has historically been a differentiator, something that could set a business apart and justify a higher multiple. AI, however, is beginning to follow a different trajectory. As its use becomes more widespread, it is increasingly viewed as a baseline capability rather than a source of competitive advantage.

Deloitte’s research into dealmaking reflects this shift, with AI now embedded in a significant proportion of M&A processes. In other words, buyers expect to see it, but they are no longer impressed by its mere presence.

For founders, this creates a subtle but important change in how AI influences valuation. A lack of AI capability may raise questions or concerns. Basic usage is unlikely to move the needle. Only when AI is applied strategically does it begin to affect how a business is valued.

Where AI does have an impact, it tends to be through its effect on underlying business fundamentals.

Buyers are not valuing AI in isolation. Instead, they are looking at what it enables, whether that is improved margins, more efficient operations, or the ability to scale without a proportional increase in cost. They are also assessing how deeply AI is integrated into the business, and whether it creates any form of defensibility through proprietary data or processes.

This is where a clear divide begins to emerge.

Industry analysis suggests that the financial benefits of AI are highly concentrated, with a relatively small group of companies capturing the majority of value. For most, the impact remains limited.

The implication is that adoption alone is not enough. What matters is execution, how effectively AI is used to drive measurable outcomes, which is where many businesses fall short.

It is common to see AI positioned as part of a growth narrative without a clear link to financial performance. In other cases, companies rely heavily on third-party tools without building any real differentiation, or invest in initiatives without tracking return on investment.

From a buyer’s perspective, these approaches carry limited weight. AI may feature in the story, but it does not materially influence valuation.

All of this points to a broader shift in how AI should be understood in an M&A context.

Rather than acting as a straightforward value driver, AI is increasingly functioning as a form of filter. It helps buyers assess how a business operates, how scalable it is, and how well positioned it is for future growth.

Companies that use AI effectively, embedding it into core processes and demonstrating clear impact, can strengthen their position and attract greater interest. Those that do not may find themselves under closer scrutiny.

For founders considering a sale in the next few years, the takeaway is relatively simple.

AI can contribute to valuation, but only indirectly. Its value lies in what it does to the business, how it improves performance, enhances scalability, and supports a credible growth story.

Without that, it is unlikely to make a meaningful difference.

With it, it can become a powerful part of the overall investment case.

For more detail on how AI can impact the valuation of a business, download the free Leith M&A guide here.