Orlando Bravo
Key Views & Dialogues
What’s Next for Software with Orlando Bravo
- 🗓️ Date：
2026-05-15｜ 🎙️ Show：Sohn Conference Foundation
Bravo argues domain software incumbents—not only AI-natives—are positioned to deliver the agentic enterprise after 20–30 years automating workflows. Leadership and 5-to-1 ROI, not data or system-of-record status, are the durable edge; retention has held despite AI disruption. Key watchpoints are agentic ROI, exits, and refinancing as leverage falls from 7–7.5x to 5x and spreads widen 250bps.
View Dialogue Notes & Key Takeaways
Bravo’s core contrarian call: AI is run and managed by software, so the first group positioned to deliver the agentic enterprise is the domain incumbents who’ve been automating those workflows for 20-30 years — not just AI-natives. “It’s not either or. Both sides are going to be incredibly successful,” and this wave will be “many, many, many multiples bigger than the cloud wave and the SaaS wave.” Thoma Bravo has already bought ~30 AI-native companies as add-ons.
His moat heresy, delivered categorically: “there really isn’t that much of a moat. There never was in software” — not data, not system-of-record status. The durable edge is leadership: domain founders with 20+ years who move fast and can’t be surprised by a startup because they’re talking to 10,000 customers. He thinks quality leadership “is being a bit undervalued” by markets.
On AI disruption of the 77-company portfolio he is “extremely worried” — but retention rates are holding and so far they’re not seeing customer losses to an LLM. Agentic re-platforming is uneven: Proofpoint and Anaplan are there, Ping Identity and Coupa almost, “Dayforce is ripping” — while ROI of these agentic solutions “we don’t know yet cuz they haven’t been implemented and used.”
The Medallia post-mortem (reports of creditors taking over, wiping out ~$5B of equity): a 2021 deal where they “paid too much cuz our growth didn’t materialize” — and the deeper error was replacing existing management and losing the innovative capability of a domain they didn’t really know. Would he keep existing leadership next time? “100%” — a direct break with PE’s change-agent orthodoxy.
Software financing has repriced hard: on a live ~$3B refinancing, leverage capacity has dropped from 7–7.5x to ~5x, spreads are ~250bps wider with upfront fees, and unlevered credit yields ~10% vs. ~6% before. Portfolio implication: pay down debt now to be at a pretty low level ahead of the year-two/three refi wave. And the buy-side temptation is a trap: “this is exactly the wrong time to buy a mediocre software company at a bargain price” — great assets are cheap, but “nobody at these values is willing to really talk.”
Exits stay challenging near-term — a “challenging year” after a record ~$15B flagship-fund distribution last year — though a couple of large companies are in late-stage discussions with financial-services firms and another with health or hardware firms. What reopens the window: agentic ROI showing up, incumbents (who deploy most agents today) printing 20% growth with steady margins and retention. On cyber, the next land-grab is agent identity — “how do you tell the identity of an agent? What data can it use?” — a field the identity companies “are going to own.”
🔗 Original source & video: What’s Next for Software with Orlando Bravo