Exclusive-Vista Equity in talks to hand over Pluralsight to creditors, sources say (msn.com)
How fucked are funds heavy on 2021 era assets? Starting to see some come to market where it's pretty clear that seller has been "creative" with mark to market. Not just in tech.
Am I crazy in thinking that these will still transact given how much dry powder is out there and pressure to deploy?
Discuss.
2021 tech assets are dead. Vista specifically has had shitty performance since they're 2010 fund (when they began to massively grow fund size aka style drift)...Funds will all end up massively underperforming QQQ and likely be bottom half vs. PE peers.
No matter how bad it might look for Vista, TB is likely in a more precarious spot given how much they deployed at the top vs Vista. Idk if one or two bad vintages will be enough to totally crush either firms though so in all likelihood they'll remain the top names in tech along with SLP and H&F.
What did TB do particularly bad in terms of “deploying at the top”, relative to the other big tech names (Vista, SLP, H&F)?
How much. Just read about the year in review.
I agree, have to have a long term view on the asset class as a whole and shouldn't be "kill factor" for any of these funds really.
Just curious what the lay of the land is going to look like, at some point you have to really mark to market or pass it along to somebody willing to pay those premiums. Still early but will be interesting to see what happens as we get closer to the 5-year mark on these investments.
How are H&F tech names holding up?
Is this just the first of the 2020-21 high-multiple investments coming to light? ie, is this just the first of many dominoes to fall for firms that overextended in that period?
Yes, we're only ~3 years in which is still early. Firms aren't expected to be returning capital quite yet, and can still get cute with the unrealized marks. Pluralsight went quickly because it fully collapsed, but there are very likely more bombs out there that just haven't tripped covenants and can avoid scrutiny (for now).
My guess is more of these will come in the next few years. Maybe not full marks down to zero but definitely some very low performers.
Update, officially handed over to lenders. $4.0Bn loss.
https://www.bloomberg.com/news/articles/2024-08-22/blue-owl-led-private…
$4Bn equity L.
3-years.
Big win for Blue Owl tho
Don't think any "normal" lender (aka non distressed investor) is too pleased with taking the keys of any business
They wrote down $700m of debt and have to inject new equity to own a dog they can’t operate. Not sure that’s a win?
What’s the breakdown between vista equity commitment, coinvestors, and debt - can’t seem to find anywhere.
2021 investments starting to come to light … TB and H&F pockets will be shaking too with their mega deployments
https://fortune.com/2024/02/28/thoma-bravo-tech-deals-2021-bubble-vista…
didn't vista use to say they never had any losses or negative returns smth like that?
You can't have a loss if - (1) you don't sell, and (2) there's no market price and you can grade your own homework!
Edit - in the time that TB/Vista/[any PE firm] - and you levered up the S&P 500 3:1 - you would've crushed all PE funds AND would have had liquidity at all times.
If you look at their deck, the fund from I believe 2007 still has assets in it marked around cost, those are all donuts in reality...
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