Presentation of the Manager Thoma Bravo
Summary
Written transcription
Thoma Bravo is a leading LBO firm LBO the North American software sector, named after its two co-founders, Carl Thoma and Orlando Bravo. Carl Thoma is a pioneer in LBO co-founded Golder Thoma & Co. in 1980, one of the oldest private equity firms in the world.
Thoma Bravo is a Fund manager for a long time. When I worked at Groupama Private Equity more than 17 years ago, we were investors in Thoma Cressey’s 2006 fund. Since then, the team split into two separate funds in 2008: Cressey, a healthcare-focused fund in which Altaroc Odyssey is an investor, and Thoma Bravo, a fund focused on the software sector.
Thoma Bravo’s strategy involves acquiring control of software companies through LBO, carve-outs (i.e., the acquisition of divisions from large conglomerates), or delistings, particularly through its large-cap fund. The team takes a highly operational approach to value creation. Many software companies do not manage their operating margins optimally, and Thoma Bravo has developed a highly precise playbook to significantly improve its portfolio companies’ margins during the first year of ownership. They also naturally focus on growth, particularly through acquisitions. This value creation playbook, refined over several decades, has enabled them to generate high and consistent returns over time. Thoma Bravo’s mature funds have generated an average return of 2.9x net investment and a 29% IRR . If we exclude the best-performing and worst-performing funds from our calculation, the average return remains high at 2.8x net investment and a 27% 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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