As operational complexity increases and investor expectations evolve, lift-outs have become a valuable tool for fund managers seeking to streamline operations and focus on performance. But for a lift-out to succeed, it requires more than a simple handover of staff and systems. It must be underpinned by clear strategy, structured planning, and the right partner.
Here, we explore the practical elements that determine whether a lift-out programme creates lasting value - or ends up falling short.
Define what success looks like
Lift-outs are transformational. They’re not about short-term fixes but about resetting the way operations function across the business. Before engaging with any partner, managers need to ask: what are we trying to achieve?
Whether it’s reducing cost, scaling efficiently, modernising technology, or increasing operational resilience, having a shared view of the end state is essential. Without this clarity, decisions around scope, staff, and systems become reactive and fragmented.
It’s also worth recognising that lift-outs are not just about removing costs. They are about reinvesting in areas of the business that drive growth and performance - while handing off non-core tasks to a provider that can do them better, faster, and more consistently.
Scope sets the tone
Scope is where many lift-outs are won or lost. One of the biggest risks is limiting scope too tightly to avoid disruption. While that may seem prudent, it often prevents the project from achieving its full potential.
Instead, look at the wider landscape. Are there adjacent functions that, if included, would increase scale or simplify oversight? Are there roles currently split across business lines that could be centralised? Giving the partner more operational room to work with creates more opportunity for innovation, optimisation, and long-term efficiency.
Crucially, the scope must be aligned to your business drivers. If the aim is to reduce overhead and future-proof operations, then the scope must be defined with those targets in mind.
Focus on three dimensions: people, technology, and operations
Every lift-out touches three fundamental areas—and each deserves equal attention.
1. People
Ask: what roles are core to our strategy, and which are simply business-critical? Consider whether positions can be split (e.g. strategy stays in-house, support moves out) or whether partial full-time equivalents on the periphery could be included. Being flexible about where the “line” is drawn will help create a more cohesive model—and often, better service-level clarity.
2. Technology
Legacy systems are often the root of inefficiency. A lift-out gives firms the chance to challenge their attachment to in-house tools. Why are certain platforms still in use? Are they delivering enough value for the cost? What market alternatives exist? A strong partner should bring access to platforms that are secure, scalable, and regularly updated—freeing internal budgets for strategic investment elsewhere.
3. Operations
Where are the inefficiencies? Are there manual workarounds due to system gaps or staffing limitations? Are service level agreements and key performance indicators well defined and enforced? Bringing these operational pain points into the scope of a lift-out can yield immediate gains in accuracy, accountability, and turnaround times.
Build the right model… and the right team
Having a clearly defined target operating model (“TOM”) is essential. It sets the standard for what success looks like and informs every downstream decision. Without a strong TOM, partners can’t design the right workflows—and firms can’t hold them accountable.
When choosing a lift-out provider, look beyond the brochure. Ask:
- Do they operate as a service-led organisation, or are they a technology-first platform with limited delivery experience?
- Can they offer coverage across multiple geographies and service lines or will you need multiple providers?
- Have they led similar programmes before? Do they have programme managers and change experts to manage the transition without disruption?
This last point is key. The best providers can show examples where staff have been successfully rebadged, systems migrated without delay, and client service preserved throughout. They’ll have a deep bench of operational leaders who understand how to move, stabilise, and leverage entire workflows - not just maintain steady-state processing.
A catalyst for growth
Lift-outs are no longer fringe solution; they’re becoming foundational strategies for forward-thinking managers. As cost pressures and operational risks rise, lift-outs offer a proven route to scalability, improved governance, and more predictable delivery.
We’ve guided clients through every phase from first discussions and scope definition to system migrations and service transformation. We understand the risks, but more importantly, we know how to capture the opportunities.
So, if you’re considering a lift-out, ask yourself: is now the time to act? With the right planning and the right partner, the answer may well be yes.
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To learn more about lift-outs and their impact on private markets, download our research report: Leading the shift: Transforming private markets in a retail-driven landscape.
