Thoma Bravo getting 20-45% returns on taking tech companies private

“The whole entire space is going through a transformation to cloud computing, and it feels like the entire industry is for sale,” Orlando Bravo, a managing partner at [Thoma Bravo], said in a telephone interview.


  • “The firm, Thoma Bravo, said on Monday that it had closed its 12th fund at $7.6 billion, which surpassed an initial target of about $7 billion because of high investor demand.”
  • “Thoma Bravo’s previous funds have generated internal rates of return ranging from 20 to 45 percent.”

And from a press release about raising the recent $7.6bn fund (Fund XII):

  • “Since 2003, Thoma Bravo has completed more than 140 software and technology-enabled service acquisitions, representing about $30 billion in enterprise value.”
  • “Representative past and present portfolio companies include industry leaders such as Datatel, Digital Insight, Entrust, SonicWall, Network Instruments, Hyland Software, Deltek, Blue Coat Systems, Elemica, Riverbed, Compuware and SolarWinds.”

Qlik is one of the more recent buys, for $3bn. Trefis did some good, brief coverage noting that Qlik had a loss for the past three years likely due to the usual focus on top-line revenue growth, that is “due to high Selling, General and Administrative (SG&A) and R&D expenses.”

One would expect the usual course of PE “optimizing,” getting rid of those staff and scaling by coasting on the brand name of steady drip of new features. That is, you move a hockey-stick of expensive growth to a more leisurely hill and take out profits, cleaning up shop to be sold off to someone else who’ll make that hill into a plateau.

See also a 2014 profile of the firm, including some tech investments of note.

Source: Thoma Bravo Raises $7.6 Billion Fund to Pursue More Tech Deals

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