Presentation of the Manager Thoma Bravo

Thoma Bravo is a leading LBO firm in the North American software sector, named after Carl Thoma and Orlando Bravo, its 2 co-founders. Carl Thoma is an LBO pioneer, having co-founded Golder Thoma & Co, one of the oldest private equity firms in the world, in 1980.

Thoma Bravo is a manager I've been following for a long time. When I worked at Groupama Private Equity over 17 years ago, we were investors in Thoma Cressey's 2006 vintage fund. Since then, this team has split into 2 teams in 2008: Cressey, a fund dedicated to Healthcare in which Altaroc Odyssey 2022 is an investor, and Thoma Bravo, a fund dedicated to the software sector.

Thoma Bravo's strategy is to take control of software publishers through LBOs, carve-outs (i.e. buying up divisions of large groups) and exits, notably with its large cap fund. The team has a highly operational approach to value creation. A large proportion of software publishers do not manage their operating margins optimally, and Thoma Bravo has developed a very precise playbook to sharply improve the margins of its companies during the 1st year of ownership. Of course, they also focus on growth, especially external growth. This playbook of value creation, refined over several decades, has enabled them to generate high, consistent performance over time. Thoma Bravo's mature funds have generated an average return of 2.9x net investment and 29% net IRR. If we remove the best-performing fund and the worst-performing fund from our scope of calculation, the average performance remains high, at 2.8x net stake and 27% net IRR.

Altaroc has committed to 2 Thoma Bravo funds: Thoma Bravo XVI, which is their large cap fund with a target size of $20 billion, and Thoma Bravo Discover V, which invests in slightly smaller Upper Mid-market companies and has a target size of $7 billion.

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