Interview with Scott Crabill - Managing Partner - Thoma Bravo

In this interview, Scott Crabill of Thoma Bravo analyzes the impact of artificial intelligence on the software industry and on the fund’s portfolio companies. In his view, AI represents a major new technological disruption, comparable to previous transitions in the software sector: mainframe, client-server, the internet, mobile, and then the cloud. Like these previous waves, it is expected to expand the addressable software market and accelerate the digitization of business processes.The potential big winners are established software vendors with critical software, proprietary data, deep business expertise, complex integrations, and strong security, compliance, and governance requirements. These companies can add an agent-based AI layer to their existing products and automate a much larger portion of their customers’ workflows.Conversely, the most vulnerable software vendors are those that lack differentiating data, cover only a small part of a business process, or rely primarily on a technological lead that is easily replicable. These players remain capable of innovating, but their competitive position may be more fragile. Thoma Bravo believes that the majority of its portfolio is well-positioned to navigate this transformation. The fund actively supports its portfolio companies through its software expertise, investment teams, operating partners, best-practice sharing, and targeted acquisitions of native AI players. The goal is to accelerate the time-to-market for AI features, improve sales productivity, and reduce development costs. The interview also highlights the likely evolution of pricing models. Per-user pricing could gradually give way to models based on usage, consumption, or results achieved, allowing software publishers to better capture the value created by automation. Finally, AI is expected to reinforce the advantage of private software publishers capable of acting quickly, with a startup mindset and without the quarterly pressure of public markets. For the leading software companies, it therefore represents both a growth driver and a catalyst for operational efficiency.