Thoma Bravo Completes $22.8 Billion Fundraise
Thoma Bravo, a leading private equity firm focused on the software and technology-enabled services sectors, today announced the completion of fundraising for three funds totaling more than $22.8 billion in capital commitments: Thoma Bravo Fund XIV, a $17.8 billion fund, Thoma Bravo Discover Fund III, a $3.9 billion fund, and Thoma Bravo Explore Fund, a $1.1 billion fund (the "Funds"). Each fund reached its hard-cap and was significantly oversubscribed. These closings bring Thoma Bravo's assets under management to more than $70 billion, and the new funds significantly enhance the firm's capacity to invest in high quality software and technology companies around the world.
Being a software investor and seeing stuff like this makes me want to reee
good god almighty
Guess now after seeing multiples near 15x averages we'll get to see 20x multiples on average.
So you have offers from Vista, Thoma, and SilverLake... pay not withstanding how do you order and why?
They focus on different sized companies, different sectors within tech, and have different cultures/reputations.
Silver Lake: NYC + Cali offices, large cap deals generally across tech and tech-enabled enterprise/consumer. Broad tech focus. Super respected and sophisticated.
Vista: Austin, Texas. Obviously you’ve heard about the Robert Smith tax fraud but perhaps you haven’t heard about how he forced out the co-founder and what that implies about the type of culture at Vista. Anyhow, Vista is more medium/smaller cap investing so they don’t really compete with the size/complexity of Silver Lake. They’re very much focused on Software tech investing (SaaS) and are reputably the sharpest in that vertical.
Thoma Bravo: Heard a 30% IRR figure since inception thrown around (not sure if this is gross or net... if it’s net, then it would exceed Apollo’s flagship PE 25% net, wow). Anyhow, TB is well respected and plays in upper middle/large cap buyout space. Does a lot of roll-up strategy. Basically pay a premium multiple for a good centerpiece and then buy smaller businesses at cheaper valuations to run accretive tuck-in. This buy and build platform is one of their most successful strategies. They also LBO’d one of my favorite edtech companies in TTM so I’m a huge fan of them.
hope this helps.
Personally I’d pick Silver lake. Reasons? 1) hate austin, and I’d like to stay away from robert smith controversy 2) like complexity and large sized deals, and although I would like to focus on tech, I don’t want to be married to it. software-specific focus is a silo that I don’t want to be stuck in 3) out of the 3, silver lake is most likely to look at distressed PE transactions
This is a good overview. Could of things I'd add:
Silver Lake is very creative and innovative with deal structure (see Dell LBO, Airbnb, Waymo/Verily) and will stray outside enterprise tech into media and entertainment (e.g., Madison Square Garden, Equinox). You'd probably work on the most headline and household name deals at Silver Lake while Vista and Thoma deal more with nichey enterprise software businesses.
Vista is much more like a machine. They have a very regimented playbook for every single step in their deal and ops process such that everything in theory can be broken down the same way. Clearly this has worked for them in the past, but I've heard grumblings that their current unrealized portfolio isn't quite up to par with their reputation. Definitely a different experience than you'd get at Silver Lake and IMO less interesting / exciting.
Thoma Bravo seems to keep the lowest profile of the three, recent fundraise notwithstanding. Don't have much to add beyond what's written above.
Agree with the other poster in this being a good overview, only would caveat that Vista also has offices in SF and Chicago
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