Blab Business
Thoma Bravos Orlando Bravo Declares SaaSpocalypse Over, AI Drives Software Growth
In a crisp interview with CNBC’s Annette Weisbach at the SuperReturn International conference in Berlin, Orlando Bravo, founder and managing partner of Thoma Bravo, dismissed the “SaaSpocalypse” scare that had rattled the software‑as‑a‑service (SaaS) world in February 2026.
Bravo told the network that the firm’s portfolio—worth roughly $35 billion in revenue—has not only weathered the AI‑driven shakeup but is thriving because of it. He added that about half of new revenue across those companies comes from AI‑enabled products, a figure that underscores the shift from pure subscription models to value‑add services.
The “SaaSpocalypse” narrative began when Anthropic unveiled its Claude coworking agent in February 2026, sparking a steep sell‑off in SaaS stocks. The S&P North American Software Index dropped 15 percent in January, the largest monthly decline since 2008. Since that nadir, the sector has rebounded sharply. The iShares Expanded Tech‑Software Sector ETF climbed 21 percent in May—its best monthly performance since October 2001—and has risen more than 9 percent over the past three months.
Thoma Bravo is the world’s largest software‑focused private‑equity firm, managing nearly $200 billion in assets and owning about 80 global software companies. Its investment strategy centers on consolidation and buy‑and‑build deals that target application, infrastructure and cybersecurity software. According to Bravo, software firms are evolving beyond static subscription models. “People were assuming that software companies just do one thing and they stay still,” he said. “But software companies continue to evolve with infrastructure.”
He highlighted AI’s capacity to elevate software to a “completely new level” by automating aspects of human judgment. Bravo projected that AI and software will converge in new agentic solutions for corporate customers in the coming years, calling AI an “enormous tailwind” for the sector.
Beyond SaaS, Bravo noted that high‑growth sectors such as semiconductors remain attractive for investors seeking low‑entry opportunities. He also acknowledged that the market is in a period of adjustment, with companies and investors still working through governance, cybersecurity and return‑on‑investment questions related to newer AI agentic tools. “It is a period of discovery now, which creates pressure on the whole system,” he said.
Illustrating the AI integration, Verint—one of Thoma Bravo’s customer‑experience platforms—reported that its AI revenue exceeded legacy product revenue for the first time in Q2 fiscal 2026, reaching $372 million. The company is merging with Calabrio, another portfolio firm, to build a CX automation platform; the merger is pending regulatory approval. These moves demonstrate how the firm’s holdings are embedding AI into core offerings.
Thoma Bravo’s buy‑and‑build strategy has also produced several consolidation deals, including the planned partnership between Calabrio and Verint to automate customer‑experience workflows with AI. The firm’s focus on scale is intended to add value and accelerate growth across its portfolio.
The SuperReturn International conference drew senior private‑equity and venture‑capital professionals from around the world, offering a forum to discuss AI’s impact on technology investments.
Investor sentiment has shifted from the February sell‑off to a more positive outlook, as reflected in the performance of the iShares Expanded Tech‑Software Sector ETF and the broader market recovery.
Analysts are watching how AI integration affects revenue streams and valuation multiples. Thoma Bravo’s emphasis on AI‑driven growth aligns with broader industry trends, but the exact impact on its portfolio companies’ financials remains to be seen. Investors will be looking for updates in upcoming earnings reports and any new deals that further blend AI with traditional software offerings.
In summary, Orlando Bravo’s statement signals a change in perception about AI’s role in the SaaS market. While the sector has rebounded from the February sell‑off, the long‑term effects of AI on software business models and valuations will unfold over the next few years. The industry’s next steps will become clearer after the next round of quarterly earnings, regulatory developments and potential new acquisitions in the AI‑software space.
Bravo told the network that the firm’s portfolio—worth roughly $35 billion in revenue—has not only weathered the AI‑driven shakeup but is thriving because of it. He added that about half of new revenue across those companies comes from AI‑enabled products, a figure that underscores the shift from pure subscription models to value‑add services.
The “SaaSpocalypse” narrative began when Anthropic unveiled its Claude coworking agent in February 2026, sparking a steep sell‑off in SaaS stocks. The S&P North American Software Index dropped 15 percent in January, the largest monthly decline since 2008. Since that nadir, the sector has rebounded sharply. The iShares Expanded Tech‑Software Sector ETF climbed 21 percent in May—its best monthly performance since October 2001—and has risen more than 9 percent over the past three months.
Thoma Bravo is the world’s largest software‑focused private‑equity firm, managing nearly $200 billion in assets and owning about 80 global software companies. Its investment strategy centers on consolidation and buy‑and‑build deals that target application, infrastructure and cybersecurity software. According to Bravo, software firms are evolving beyond static subscription models. “People were assuming that software companies just do one thing and they stay still,” he said. “But software companies continue to evolve with infrastructure.”
He highlighted AI’s capacity to elevate software to a “completely new level” by automating aspects of human judgment. Bravo projected that AI and software will converge in new agentic solutions for corporate customers in the coming years, calling AI an “enormous tailwind” for the sector.
Beyond SaaS, Bravo noted that high‑growth sectors such as semiconductors remain attractive for investors seeking low‑entry opportunities. He also acknowledged that the market is in a period of adjustment, with companies and investors still working through governance, cybersecurity and return‑on‑investment questions related to newer AI agentic tools. “It is a period of discovery now, which creates pressure on the whole system,” he said.
Illustrating the AI integration, Verint—one of Thoma Bravo’s customer‑experience platforms—reported that its AI revenue exceeded legacy product revenue for the first time in Q2 fiscal 2026, reaching $372 million. The company is merging with Calabrio, another portfolio firm, to build a CX automation platform; the merger is pending regulatory approval. These moves demonstrate how the firm’s holdings are embedding AI into core offerings.
Thoma Bravo’s buy‑and‑build strategy has also produced several consolidation deals, including the planned partnership between Calabrio and Verint to automate customer‑experience workflows with AI. The firm’s focus on scale is intended to add value and accelerate growth across its portfolio.
The SuperReturn International conference drew senior private‑equity and venture‑capital professionals from around the world, offering a forum to discuss AI’s impact on technology investments.
Investor sentiment has shifted from the February sell‑off to a more positive outlook, as reflected in the performance of the iShares Expanded Tech‑Software Sector ETF and the broader market recovery.
Analysts are watching how AI integration affects revenue streams and valuation multiples. Thoma Bravo’s emphasis on AI‑driven growth aligns with broader industry trends, but the exact impact on its portfolio companies’ financials remains to be seen. Investors will be looking for updates in upcoming earnings reports and any new deals that further blend AI with traditional software offerings.
In summary, Orlando Bravo’s statement signals a change in perception about AI’s role in the SaaS market. While the sector has rebounded from the February sell‑off, the long‑term effects of AI on software business models and valuations will unfold over the next few years. The industry’s next steps will become clearer after the next round of quarterly earnings, regulatory developments and potential new acquisitions in the AI‑software space.
