A $20B Wave of Take-Privates
This summer, the SaaS public markets felt like a clearance rack.
Thoma Bravo took four SaaS companies private for nearly $18B combined.
Centerbridge Partners joined with a $2B buyout of MeridianLink.
That’s almost $20B of SaaS pulled off exchanges in weeks.
The logic is simple: public markets have grown skeptical, punishing many SaaS names with depressed valuations. But private equity firms like Thomas Bravo see something different: durable revenue streams, sticky customers, and untapped AI upside.
The Backdrop: SaaS in the “Fast Fashion” Era
We’re living in what Sam Altman calls the Fast Fashion Era of SaaS.
Just as Zara or Shein can mimic Paris runway looks in days, modern AI-enhanced dev tools and no-code platforms let solo developers launch SaaS apps almost overnight. The result:
Cheap and abundant supply of new apps.
Low switching costs and endless lookalikes.
Short shelf life, with many products that burn bright and then disappear.
For investors, this glut means noise drowns out signal. Public markets discount SaaS broadly, fearful that even mid-tier names are vulnerable to “slopware” competition.
The Gap: Durable SaaS Gets Mispriced
But here’s the twist: not all SaaS is fast fashion.
Some platforms are more like couture staples — hard to replicate, deeply embedded, and critical to enterprise operations. Payroll, credit decisioning, workforce analytics, customer engagement — these aren’t problems solved by a weekend hack.
Yet public markets often lump them in with the disposables. That’s why:
The SEG SaaS Index shows a split: the top quartile trades at 10–12× revenue, while the bottom quartile languishes at 2–4×.
Solid, cash-generating SaaS firms with sticky ARR get punished simply for not being “growth darlings.”
This valuation gap is where private equity pounces.
Notice the common thread: AI relevance layered on top of durable, sticky SaaS.
PROS helps enterprises set prices with AI.
Verint gets half its ARR from AI-driven features.
Dayforce pitches itself as the AI-enabled HCM leader.
Even Olo frames its restaurant ordering stack around guest engagement data.
These aren’t disposable clones. They’re infrastructure software with longevity.
Thoma Bravo’s Playbook: Classic, Not Trendy
Why Bravo, and why now? A few levers explain it:
Unmatched Firepower. In June, Bravo raised $34.4B across three funds, the largest tech-focused haul this cycle. Few rivals can move this aggressively.
Operational Polishing. Bravo doesn’t just buy — it refines. With Verint, for example, they plan to merge it with Calabrio (another portfolio company), creating a consolidated AI customer-engagement suite.
Exit Track Record. Since 2023, Bravo has returned $30B+ to LPs, including a 35% IRR on Adenza’s $10.5B sale to Nasdaq. That’s why LPs keep handing over fresh capital.
Patience for Quality. Public markets demand hypergrowth. Bravo can hold 3–5 years, restructure, and sell or relist once multiples recover.
Couture vs. Fast Fashion: The Core Contrast
This is where the analogy really clicks.
Fast Fashion SaaS: disposable, crowded, and hard to monetize long term. Great for experimentation, weak for durability.
Thoma Bravo’s Targets: sticky, cash-flowing, essential platforms that enterprises won’t rip out.
Bravo is essentially saying, “We’ll leave the Shein-style SaaS experiments to VCs and solo devs. We’re buying the couture pieces public markets are mispricing.”
Thoma Bravo’s thesis is further strengthened by a survey they conducted with 501 SaaS and Cloud buyers which pointed to further spend into future years (see below).
Implications for Operators and Sponsors
Profitability as Moat. The “growth at all costs” playbook is dead. Private equity wants efficiency, retention, and cash generation.
AI as Table Stakes. Even the classics need to modernize. Every one of Bravo’s deals emphasizes AI as a growth lever.
More Consolidation Ahead. With $34B of dry powder, Bravo isn’t slowing down. Expect more mid-tier SaaS take-privates where revenue durability outpaces market multiples.
For Operators: if your public SaaS stock is stuck in the bottom quartile, you’re a potential target. Sharpen retention metrics and your AI narrative — that’s what makes you attractive.
For VCs and Growth Equity: rethink exit paths. IPOs may undervalue your SaaS asset. PE could be the more realistic liquidity option.
Closing Frame: Betting on the Timeless
The SaaS market today is bifurcated:
An oversupply of disposable, fast-fashion apps.
A handful of durable, couture platforms that enterprises can’t live without.
Thoma Bravo is betting billions that the classics will win. By scooping them up at public-market discounts and layering in AI and operational polish, they’re playing a long game while everyone else chases the trend of the week.
In fast fashion, trends vanish overnight. In enterprise SaaS, the timeless still commands a premium.