Orlando Bravo, managing associate of Thoma Bravo, speaks throughout “Squawk on the Avenue” on the World Financial Discussion board in Davos, Switzerland, on Jan. 21, 2026.
Oscar Molina | CNBC
Orlando Bravo, founder and managing associate of Thoma Bravo, pushed again on mounting criticism of personal markets, saying deep sector experience is separating winners from losers as synthetic intelligence creates disruption throughout the software program business.
“We now have been dwelling within the particulars of the house for a really, very very long time, not on a excessive stage, not investing in shares, [but] investing in corporations, buyer contracts, understanding the small print. So, sure, as a sector specialist in personal fairness, our corporations are very, very completely different,” Bravo stated Tuesday in an interview with CNBC’s Leslie Picker. “We’re so comfy with our personal credit score ebook, given the alternatives we have made as a specialist.”
His feedback come as buyers step up scrutiny of private-market valuations and liquidity after a wave of markdowns and redemption strain throughout personal credit score and fairness funds.
Morgan Stanley just lately stated it expects direct-lending default charges to succeed in about 8%, nearing Covid-era peaks. In the meantime, John Zito of Apollo World Administration informed UBS shoppers final month that non-public fairness companies are broadly misstating the worth of their software program holdings, saying “all of the marks are unsuitable.”
Bravo stated Thoma Bravo’s investor base, which incorporates main U.S. pension funds and international sovereign wealth funds, has remained assured as a result of agency’s lengthy observe document and transparency.
“They’ve seen our marks, they’ve seen our exits, they’ve seen our development,” he stated. “Everyone’s extraordinarily comfy.”
Addressing one of many agency’s extra seen missteps, Bravo acknowledged overpaying for buyer expertise software program firm Medallia. Apollo’s Zito pointed to this $6.4 billion take-private deal in 2021 particularly, saying will probably be “worse than folks anticipate,” in keeping with the Wall Avenue Journal.
“After we purchased it, we method overestimated or extrapolated the very excessive fee of development of that firm into the long run. We made a mistake. And that price us to pay an excessive amount of. Now, the fairness from our standpoint has been impaired for a very long time,” Bravo stated. “Our buyers, this group that holds the capital on the earth, has recognized that for years. So there isn’t any new information.”
Nonetheless, he stated the broader portfolio is performing strongly.
“The opposite 77 corporations that we’ve, for probably the most half — and it is so related for AI — they’re completely crushing it,” Bravo stated.
Bravo drew a pointy distinction between personal equity-owned corporations and plenty of publicly traded software program companies, saying the latter face accelerating disruption. He famous that current valuation declines in some names are “very warranted.”
“Within the public markets, when you take a look at it, there are a lot of, many software program corporations within the public markets that might be disrupted from AI. These corporations have been going to be disrupted anyway. AI will create a disruption lots sooner,” Bravo stated.