YouSaid · the spoken record

Orlando Bravo

lines on the record: 80
first: 2021-08-02
most recent: 2021-08-02
sittings or episodes: 1
sources: podcast

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“Work life balance I worked way too hard when I was young. I could have traveled more when I was young, I could have enjoyed college, more when I was young versus just tennis and studying. I wish I would have spent more time on the fun aspect of it. As I went through life, I didn't have that much work-life balance until I had to make some changes to that. And those changes were so good for the work part of it because the more I put life into it, the more I was forced to delegate and the more my partners rose to be the leaders they are today. We have the managing partners we have today are just running these incredible sectors and it happened because I needed to back off in order to have even a better career. the work-life balance yeah that's the one”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“My dad, he had a very small business in Mayagues and through example, I would see how hard he worked. I mean, he was just always working, and sometimes I would just come see him at the office. And that was the life. And that's an important, a really important role for me. And my mom, she always taught me through repetition. She would sit there when I was doing homework and it's repeated again, go through it again, again and again. And that's how tennis was and that's how I still think today.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Not to take myself seriously and enjoy the journey. I remember we were in this tennis tournament. My first tennis tournament in California that he took me to, long trip, right? We go to Los Gados, fourteen and under national, and I had a match at eight AM the next day. And we had just gotten there and I wanted to go out and have some fun in the pool with a bunch of friends in the tennis thing and I came to the room sheepishly, some motel and I said, Antonio, can I stay out a little later? And he was like, are you crazy? You stay out a long time. That's why you're here, to make friends and enjoy the journey. And that was nice. And I carried that till today. It's a good deal or bad deal. Enjoy what you do. And don't take yourself seriously.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Spoke about Carl Thomas, Marcel Bernard. I'll add one is Antonio Ortiz, my tennis coach in Puerto Rico. One of the beauties about the sport is how close you get to a coach, especially if you're with him for a long time. And he taught me”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Big one is how so many market participants. Explain the market as if it's true. So for example, when they say, well, the reason this time is not good for IPOs is although the market is up, that's the secondary market, but the primary market is struggling right now because we're about to go into the summer and many portfolio managers are going to be taking the summer off as if that's true and then it spreads around and people tell the story that absolutely makes no sense. You know, hedge funds don't sleep, they're highly competitive, they'll look at any deal at any time, so do we. It doesn't make any sense. But people kind of start talking about this and almost believing it and behaving as if it's true.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“I have so many I call it the deal The deal has its own language almost, of when you're looking at a deal, you're competing for a deal, and you ask questions like, well, how many bidders are there? And the answers are, it's between a handful and a, but why can't you just say seven? What am I going to do with that or five? It doesn't matter. Or how's our bid? It's undifferentiated. But say that you cannot say or tell me how a bid is, but there's that own, right? That own community's language is really super annoying.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Personal pet peeves when people say you should. You should do this but I don't want to or maybe you think I should it's mainly a communication issue along the lines of the other one To be totally honest. It's like, okay, don't be totally honest.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm not that good anymore, but yeah, you know, it's crazy how many good players there are. And you know who I love hitting with? I love hitting with kids. Like fourteen, fifteen year olds that are really trying to compete, they're so good. And that's the players in San Juan that I learned from. That's what would happen. These great players that were in their 50s would come play with me after work and I just loved it.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“But also how society in Puerto Rico is so divided in wealth. Puerto Rico is one of the most unequal places in the world, actually, along with five other African continent countries. And given the opportunities that were given to me, I said, let's go fix that. Let's see if we can provide an environment where all talented young adults can have some meaningful opportunities for personal and professional growth. And that started us in this journey. And once you're in it, forget it. And it's much harder than private equity, by the way.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“So we responded back and we said, well, if you can get this to the mayor, we will be there in a day and a half with what the mayor needs to hold it together. And when I got there, it was just a completely shocking experience from all these memories. I had high school friends that came over to say hello. I mean, it's just that I hadn't seen in 30 years. It's just an amazing thing. But what hit me was that we were the only ones there at the time. So we did for a period of time make a difference. And what I tell young people in philanthropy is, remember, if you don't do anything about it, nobody's going to do anything about it. You can make a big difference. And once we were there, I saw the beauty of hardworking people that I remember.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“When I got back, I couldn't reach any friends, any family. Completely, there's no communication. And a day after I was able to talk to my dad and things were not good. And my brother befriended a reporter in the island. And on day two, post-hurricane, she told them that there's a shelter in this town called Lattis, which is close to where I grew up, where the mayor said, I only have two days left of food and water for 35 people. And then I'm looking at CNN and I'm seeing what's going on and what's the governor saying. I remember calling my cousin and asking him, can you drive all the way from San Juan to the west coast, or is it true that everything's blocked and you can't do it? He's an adventure travel person. He runs an adventure travel company in Puerto Rico. And he did it. Yeah, you can do it.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“I started in philanthropy, I like to think relatively early with classes that were personal to me. That's how you go about these things. The catalyst for starting the Bravo Family Foundation was Hurricane Maria. Puerto Rico. And I had just come back with Jennifer James, our COO, from a fundraising trip in Asia. And the hurricane hit when I was in Tokyo the last day I was there.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Be longer dated or permanent capital vehicles, which is becoming more popular and more interesting now given the conversation we had about exits and how do you do that, we have some in the industry that we can also emulate in terms of what they've done and learn from that and see what fits our culture. It could be regional products, whether in Europe or in Asia, as Asia is maturing in tech and now there will be opportunities to buy companies that have enough of an operating history that fits our framework. And it can be other forms of financing as well.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“In five years from we're going to be double the size. We have $80 billion under management and we can tell how the portfolio is going to do. We have it on the ground. We see where our space is going. We see that we're creating some white space in the large software deals. And we actually need the capital because the industry needs it for us to buy these number one number two players. They're growing at 20% compounded. So we're going to be double the size we are going to grow as an investment team but not commensurate with that growth with the philosophy of providing people full opportunity to be future leaders. And we will be forming other products that align to what is the best financing alternative for these companies.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“The few that did, that fund returned for net, and then it gave about a 1x multiple in Co-invest that was great economics and produced great returns. And it helped many of them establish other programs that were great. So I think really, really understanding the portfolio and how it's doing is important work”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Our numbers are our liquid numbers were good, but there were not enough liquidity events in software to establish a track record. But we saw as a GP clearly how the portfolio was absolutely amazing in terms of future returns. And I think that most LPs, given how many good choices they have, they didn't want to look at that. They didn't have the time, or maybe they have better choices, or what have you. And the few that did, because we ended up, we tried to raise a billion, we ended up raising 822.5. That tells you we're looking for every penny, like every 500,000 we would take.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think the most important thing is understanding the culture of a firm. So I really respect those LPs when in an at-work environment in the office environment, they would spend the time walking around the office and having some improper meetings, hearing what people are talking about on phone calls and in the office is key. If you walk around Toma Bravo, most of our colleagues will be talking to companies about sales plans and quotas and they may be on a board call. It's a lot of operational talk. If we say that that's one of the keys to our value add, then that's what people should be talking about in the office. They shouldn't be talking about financings and financial engineering. And that could happen. So I think that's a key one. I think when we were getting started, when we became Toma Bravo in two thousand eight.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“and our role is I see it as what kind of next generation private equity firm are we and how we adapt to society that way. It's more with the times. So we have a lot of young people, we run a much flatter organization. We don't have an org chart because everybody knows what their job is. We look to transfer ownership over time. I think that's consistent with how the world is working now and how people want it to work as well, which is a totally different world than in the 80s when you had to break up these huge corporations that were potentially abusing their power over their shareholders. And you had to break up these divisions and run it differently.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“First, I really like the, if you can call it a prior or earlier generation, many of them are my mentors, just out of the goodness of their hearts, really. I have an incredible appreciation for what they meant at the time. They invented the private equity industry. Sometimes I see them and I go, Bye, thank you for inventing the private equity industry. I really appreciate it.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Whereby the more innovative number one number two player higher growth companies The second way we deal with it is we have had to improve the margin that we deliver. Best in class metrics before were twenty five percent EBITDA margins. Now we're getting up to 50. Elie got up to sixty percent. So both trying to get better and buying the right thing for today as well”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“There should be 20 or 30 private equity firms doing large buyouts and software. It's a great place to be. But if you have to pay 10 times forward revenue for a company that does 5% EBITDA margin at scale and you don't have a track record of having delivered 40 to 50% margin while growing that business, an investment committee is not going to take that risk and they shouldn't take that risk. We were lucky that we started our first equity check was $25 million to do this kind of work. But now that you prove it, you can keep moving forward. Then how do we deal with a prevailing valuations is two ways. One is we buy growth. That's going back to our prior point. We have not bought a 5% grower vertical market software company in a long time. And that's what we all we used to do 20 years ago.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“The challenge that we have is the prevailing market multiples, public multiples of software companies, the challenge that we have is not competition right now. And it's worked. You can look at the negatives, but also positives. And the fact that valuations have been high, some claim too high, actually is a barrier to entry. It keeps big players that could be new players or new entrants out of this market.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“As the markets have grown to have more of an appreciation for the value of these software businesses, the power of technology and competitions come in, how have you addressed what's ascending multiples and more competitors looking at the types of businesses you'd like to buy?”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Our mission is to help these innovative software companies achieve close to their full potential and do it again and again by being in this market or not adding any work because we're already in these verticals. We're already talking to these companies. We're already interfacing with them. This is what we do. This adds value to our core business and it makes us more informed and better at public markets and we have so many candidates that will be public companies. That's going to be a way for us in the future of exits. So it adds to what we do. It puts us more in that community. It gives us a better brand. It allows us to talk to more people which improves our private equity business.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Investors are right in pointing out that that they want the GP focused on the business that they're paying the money to do. And there's a lot of money they're paying. What we have explained to our partners is this is the business that we do.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Come back in every reporting cycle to the original projections they gave the street and explain the variances, why they're doing better or worse, and have the SPAC sponsor do the same on their next pack. And T have transparency. Who is the sponsor? Put up the entire track record of the sponsor. And if the sponsor doesn't have track record, that could be okay too, because maybe an investor says maybe they're really hungry, or maybe they'll get lucky for the first time. I kind of like that. And then finally is alignment. Half the spec sponsor put hard money down in the deal just like in private equity and GP puts in a percentage into the fund.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“If the good thing about a spec is that you could put projections, I love projections. You do too. Investors need them. How does he even management think about projections? A really important part of investing in a venture. Give me those numbers that match the theme that you're talking to me about. We tell companies, I don't understand anything without numbers when they start a presentation. So make it accountable. Have the SPAC target.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“As with anything that grows that quickly, there are a bunch of bad deals in the stack market. There are things that absolutely don't make sense, but society will learn, and they'll throw the bad ones out, and they'll throw the bad sponsors out people in the financial markets, they reward performance, ultimately. And when it's not there, they just won't back the bad ones again. And that'll be it. We believe in the following principles in his back. Let's marry the best of both worlds, the beauty of being a public company that energizes employees actually, and provides these securities to the retail investors well. But marry that with what has made private equity great. And we call it the radar principle. Make it be for real companies of certain revenue size. The R accountability”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“I think specs are awesome. They've been around for a long time. There is a reason why they boomed recently. And the reason is a good one, which is the financial industry and Is innovating in order to be able to absorb the technology innovations that are there. And this is one such innovation is there's so many potential IPOs, there's so many unicorns in software and technology, there's so many deals to be done. How about if we put that one in the mix in a bigger way?”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“The incredible place we're in is we don't really need to because software is going there. Software itself is extending into becoming the business. I was having a lunch yesterday where this venture capitalist was asking if we would invest. In business models where the business model may be you're selling a financial service but you're a software company. Instead of renting your product, of course we will because that's value based pricing. That basically causes your product to be priced a lot higher potentially than selling a license. It's like being in the consulting business versus in the getting carry business in alternatives. So it's taking us there.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Within the vertical of software where you play, you've had these opportunities for these people to take over a mid-market, a credit. Do you think about extending horizontally into other industries if in fact that's what's needed for someone to be able to have that leadership position?”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Hudson Smith are huge leaders and have become some of the best mid-market private equity leaders out there. We're able to establish that. We do the same thing with Explore. Our smaller buyout product. We do the same thing in credit and so on and so forth. And there will be many, many of these opportunities to get these talented young adults to have a journey that it'll be their own journey. It won't be mine. Things are different. But it might be better, but they'll still have the opportunity to lead and to be able to do great things”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I feel a big sense of responsibility of being able to provide. A similar opportunity to all of our colleagues. Unless I feel a sense of anxiety and stress over that. And that's one of the reasons why we keep the investment team as small as possible. One is what I described before, giving people big jobs, and it's a better way of making decisions. You don't need more than five or six people in the deal team. You don't need 20. What would they do? They even have a hard time catching up with one another. But the other thing you do is you have the chance of recruiting the best people that want to be future leaders. And we do that by As we continue to be lucky and put up good results, we're able to establish in this great software industry that's growing beyond our growth rate. We're able to establish products like mid-market buyouts.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“We've done that. We had and have this company called Flexera. And Flexera was a deal that we sold If we solved that in around 2010. to Ontario Teachers. We retained a small percentage of the company. The company did great for Ontario teachers. Then TA came in and did a recapitalization of the company, but our small position and bought part of Ontario teachers' position in the deal. And then last year, we bought the majority of the business back. And Jim Ryan is the CEO. He was the head of sales. And then COO under our ownership. That's a good example because one of the things I feel very proud of that our team does is we bring software assets to the private equity community and to the LP community. Flexera was a division of macro vision thing called Rovi. And the company we had to improve the margin, we had to make it an investable private equity asset that was part of our value add. And then once you're in that, you're in private equity.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“And that's the best candidate because they've implemented our plan. We've made money together. They know us and we're not taking risks with anybody new.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's such another great insightful question because what we have noticed when we sell these businesses, if they are sold to private equity we can track them. Whatever we did together, they continued to do for a very long period of time. So, all that initial work that went into it, we have almost set these companies up to become private equity assets for long periods of time. We see them trading from one private equity firm to another, and everybody does well in it with the same team. We keep in touch with them as friends. We may buy a competitor. We may buy a company that partners with them most likely. And at some point in their career, we actually get many of them to be operating partners at Thomopravo.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“We had to prove it and we had to sell to continue to deliver money back so that people could invest more with us. We continue to iterate on that. Now, our bias as well, I'll give you another one, has been as follows When a strategic approaches you, look to sell because they won't approach you again. They'll either build the product internally or buy somebody else. And by backing existing management, if you can get the changes done early, you're more ready for that approach. Early May, we sold that 18 months after we bought it, but it was a different company 18 months. After we bought it, and the buyer got a great deal and we got a great deal. It's really working for the buyer. Sonic Wall, we also sold after 18 months in cybersecurity. The company was a different company.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“You can go to work before you close the deal in that period between sign and close. When you have to change people, people need to learn the business. You need to recruit them. They recruit and then people that they like. And it takes a while to come together. That's a key reason for our average children period. We can accomplish these three things or whatever priorities are very, very quickly at a company. Now, in hindsight, based on where software has gone, we should have held all the companies. And if we would have done that, we would have been much larger than SA And the returns, the multiples of money would have been just so much greater.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“We've gotten better at that. If there's one area of improvement. And we've been watching it and getting better is how do we exit? Our average holding period has remained at three point three years. Even as deals have gotten a lot larger and valuations have gone up, it just hasn't changed. One of the reasons for that, and one of our really smart limited partners about fifteen years ago when we were an advisory meeting, he mentioned this. He said Your value added approach happens very quickly. You can tell very quickly how much value will be added to each company. And I thought that was so insightful because when you're backing existing management,”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“How do you think about holding period and exit strategy? So you own these businesses. There's a lot of ways you can improve them. They're great businesses, but for the most part, you're in a private equity structure, which requires an exit. How do you think about where you evolve and when you exit?”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“All of these companies, so a lot of the sharing happens. I feel in our culture and our philosophy is have it happen at the project level. The more centralized you become, you're putting the monkey on your back and you don't want that. You want to delegate it all down.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Like a pack of wolves, it happens every Monday in this great... Collaborative sharing environment We get together every Monday both as an investment team and with our operating partner group and you see every couple of years you see a big theme that gets rolled out through all the portfolio companies At one point it was how do we work with the channel? What are the best channel partner incentive programs? And how can those be modified to fit the needs of us the manufacturer of product and as well as the distributor but those themes kind of roll from one year to the next? Now we do have 25 operating partners that work across.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“So, as you go through the evolution of ownership of one of these businesses, you implement these three things, hopefully good things happen. There's probably three more then and three more after that. How do you go about distilling and sharing all of the lessons that you've learned on the operations of these somewhat comparable businesses across each other in your portfolio over time?”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“Instead of these strategic board meetings, and in those ops reviews we have all the direct reports of the CEO present together collaborating and we go through each of those areas. A lot has been said about playbooks. We could implement thousands of metrics on these companies, but there's no time. Marcel Bernard used to say, if you try to get to all, you will get to none. So within our framework, we then figure out what are the three big things. that will be really material to the company and that are the easiest to do and that can actually be executed by the culture that we inherited and this team thinks that they care about. And let's try to make those three things work and prioritize.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“We on board the company into our reporting package. That has our hundreds of metrics by division functional area and potentially business unit if the company has multiple business units. That takes about three months of work. Armed with that data were then able to separate the businesses, so that managers that reporting to CEO actually kind of get a promotion because they're really running businesses rather than cost areas or cost centers. So the person responsible for customer care, they'll have revenue as well as cost. So they'll have quite a bit of pricing influence and they start getting a lot more creative about how to do things to improve their renewal rates. That's a key thing we do. We then go into our playbook. We do monthly operating reviews from 8 a.m. to noon. Every month.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“And we structure ourselves to get to the point by these small project teams are structured by software subsector. So we have managing partners that run the big verticals, applications, infrastructure, cybersecurity. But within those, we have teams that run healthcare software, financial technology software, individual identity in cyber. Those teams are responsible from originating the deal, knowing their community, knowing everybody in the space, as well as executing on the deal and serving on the board of those companies. When we went into COVID, that organization served us so well because everybody, when going remote, they knew exactly what their job was and what they needed to do.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“It's so great. We are Lucky to be structured by many verticals. So we work, our philosophy is to work in very small project teams. Because when you do that, you give the associate on the deal, the VP on the deal, all the participants a very broad job. And when you have broader jobs, you become a lot more creative. We believe that the individual should see everything on the investment. The financing, because the financing is coming out a certain way, the price may not be working, or if the price is not working, you may need to reduce the cost more, or you're taking more operating risk, or there's creative solutions that you need to figuring out all the time. Maybe can you model in and add an acquisition? Can you sign that before the deal's happening? So you kind of are trying to solve this problem of how do you price or win this deal by looking at everything around it.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“You were talking to me trying to inspire me to sign it and not talk to anybody else and you know exactly what was going on. Your partner had the CEO all over the CEO, your principals and BPs were all over the banker, and you were all like a coordinated effort of surrounding us, this asset. And you didn't let us go anywhere else. He said, I told my team that I want you to be like a pack of wolves. That's collaboration and that was coordination. And he was so nice to say that. And they're just a great firm. But we make decisions by constant communication. So I may get a call from one of my partners that I'm usually the secondary on deals. And he may just tell me something that he learned in an hour call with a CR management. And then we kind of review that, think about it, begin to make some judgments, and then continue that process. It's a very iterative small decision.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“We work so collaboratively Give you an example. We bought a great business from a private equity firm six years ago. And I'm friends with the chairman of that private equity firm. After we signed the deal, He gave me one of the best accolades that I passed on to my team. And they're a great firm. And what he said, he said Your team is like a pack of wolves. You surrounded my company.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source
“It goes back to a sense of purpose and omission. Why do they care and why do they care so much? Is it something that they owe their organization and the people that have helped them and the next generation leadership? Is that it? That's a big one. That's a big one for me personally. Is it something in their background? That they have something to prove all the time to themselves. Is it that they need external reformation from their community of competitors and peers? What is it about it that really drives them? And if you can get to the bottom of that and people are doing something for a deeper reason, wow, you're in a great place.”
2021-08-02 · Capital Allocators · Private Equity Masters 7: Orlando Bravo – Thoma Bravo (Capital Allocators, EP.206) · IDENTIFIED FROM THE TRANSCRIPT · source