After decades of experience working with software companies, Thoma Bravo, a private equity firm with over $100 billion in assets under management, announced its plans to move into crypto last fall.
In this episode of The Scoop, Thoma Bravo founder of Orlando Bravo unpacked the similarities between early software companies and today's crypto landscape, and discussed the thought process behind Thoma Bravo's decision to begin investing in the crypto ecosystem.
As Bravo shared during the interview:
“At Thoma Bravo, the way to think about how we make strategic decisions is actually quite simple: we’re very ‘micro.’ We focus on what are the best deals that are right in front of us that fit our strategy. Our strategy, if you had to define it very briefly, would be: how do you turn great innovators into great companies, and how do you do that while working and empowering existing management teams?”
This is the same philosophy that has been working for Thoma Bravo since its pioneering success early on in the software industry.
Bravo went on to explain:
“With that philosophy 20 years ago, is how we entered private equity software, which almost nobody was doing at the time… So the same applied to our entry into crypto. We saw a cohort of deals on the growth equity side of our business that just had higher growth, better economics, better valuation, and they were all under an extremely powerful macro movement."
While Bravo cited many similarities between the software industry from the early 2000s and the crypto industry today, he also thinks crypto companies have an edge.
Crypto companies have “better business models,” Bravo notes. "You can build a huge business here with very little capital.”
Indeed, Thoma Bravo isn’t the only private equity firm from traditional finance to recognize the fact that crypto founders have unique needs. Sequoia Capital and Bain Capital have recently launched their own crypto-specific funds catered toward crypto-native founders.
During this episode Chaparro and Bravo also discuss:
- Bravo's investing philosophy
- NFTs and luxury digital assets
- How 'original capital' is embracing digital assets
This episode is brought to you by our sponsors Fireblocks, Coinbase Prime & Cross River
Fireblocks is an enterprise-grade platform delivering a secure infrastructure for moving, storing, and issuing digital assets. Fireblocks enables exchanges, lending desks, custodians, banks, trading desks, and hedge funds to securely scale digital asset operations through the Fireblocks Network and MPC-based Wallet Infrastructure. Fireblocks serves over 725 financial institutions, has secured the transfer of over $1.5 trillion in digital assets, and has a unique insurance policy that covers assets in storage & transit. For more information, please visit www.fireblocks.com.
About Coinbase Prime
Coinbase Prime is an integrated solution that provides institutional investors with an advanced trading platform, secure custody, and prime services to manage all their crypto assets in one place. Coinbase Prime fully integrates crypto trading and custody on a single platform, and gives clients the best all-in pricing in their network using their proprietary Smart Order Router and algorithmic execution. For more information, visit www.coinbase.com/prime.
About Cross River
Cross River is powering today’s most innovative crypto companies, with banking and payments solutions you can rely on, including fiat on/off ramp solutions. Whether you are a crypto exchange, NFT marketplace, or wallet, Cross River’s API-based, all-in-one platform enables banking as a service, ACH & wire transfers, push-to-card disbursements, real-time payments, and virtual accounts and subledgers. Request your fiat on/off ramp solution now at crossriver.com/crypto.
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