Inside Orlando Bravo’s Private Equity Playbook: How to Build a Top Firm

Summary

Orlando Bravo, founder and managing partner of Thoma Bravo, joins the All-In hosts at the All-In Summit to explain how he built a roughly $200 billion software-focused private equity firm from his Puerto Rico roots. He describes the firm's small-team, outward-facing culture, its buy-the-best and operate-the-best playbook of cutting about 15% of costs at closing and converting revenue multiples into EBITDA multiples, and how it underwrites AI disruption risk and the harder exit math of $10 billion-plus deals. The conversation also covers the $10.5 billion purchase of Boeing's Jeppesen avionics unit, the Dayforce take-private, and why Thoma Bravo will not follow Blackstone, Apollo, KKR and Carlyle into going public.

• Thoma Bravo manages just under $200 billion with about 230 people and raised $34.4 billion in June; it has owned roughly 500 software companies since 2008.
• Bravo says AI is a big risk to SaaS: many verticals will be disrupted and some areas are off-limits, though enterprise adoption is evolutionary because customers buy for cost and ROI.
• Exit math has become harder: $10 billion deals must be sold for about $25 billion, and an IPO exit at a discount to comps after paying a 30% premium starts 50% in the hole.
• Post-buyout playbook: cut about 15% of costs at closing, turn a revenue multiple into an EBITDA multiple, then drive profitable growth through bookings and add-on acquisitions.
• Thoma Bravo bought Boeing's Jeppesen avionics business for $10.5 billion against about 15 private equity bidders; Chamath frames the sale as Boeing rationalizing and cleaning up debt.
• The $12.5 billion Dayforce take-private followed 17 years of tracking the company; diligence relies on prior ownership of competitors or partners and data such as support gross margins.
• Bravo says Thoma Bravo will not go public, arguing a listing does not help raise money, win deals or improve deals, and that backing the next generation earns more.
• Bravo says for the first time publicly that Puerto Rico would be better off as a US state.