Peter Smith
Thoma Bravo founder Orlando Bravo has vowed never to invest in crypto again after the FTX debacle, marking a significant shift for the equity firm.
Thoma Bravo’s Shift After FTX Fallout
In a major shift, Orlando Bravo, founder of Thoma Bravo, has stated that neither he nor his firm will engage in crypto investments after their failed venture with FTX. Just over three years ago, Bravo had described FTX as the "most cutting-edge, sophisticated cryptocurrency exchange in the world." In 2021, Thoma Bravo was part of a group of investors that contributed $900 million to FTX at an $18 billion valuation.
However, FTX's collapse in late 2022 drastically changed Bravo’s stance. The exchange went bankrupt, and founder Sam Bankman-Fried began serving a 25-year prison sentence for fraud and conspiracy related to FTX and its sister company, Alameda Research.
FTX and Its Impact on Thoma Bravo
Bravo's announcement came during an interview on CNBC’s *Squawk on the Street*, where he shared his regret over the investment. "Once you make a mistake and once you get burned on something, our philosophy and my philosophy is you never touch it again," he said, adding that even if the crypto market experiences a boom, Thoma Bravo will not re-enter it.
This shift is significant for Thoma Bravo, a firm known for its investments in the tech sector. In recent years, Thoma Bravo orchestrated several multibillion-dollar acquisitions, including cybersecurity company Proofpoint and spend management software firm Coupa.
In 2023, Thoma Bravo returned close to $13 billion to its investors, signaling strong performance outside the crypto market. Some of the firm's key exits include the $3.6 billion sale of Imperva to Thales Group and a $4 billion sale of Barracuda Networks to KKR.
Founded in 2008, Thoma Bravo has built a reputation as a leading investor, managing approximately $160 billion in assets today.
The Promises of Blockchain
Despite his exit from crypto, Bravo remains a believer in blockchain technology. He explained that blockchain holds potential in various use cases but clarified that his firm will no longer invest in crypto-related businesses.
"I'm a believer in blockchain. I think it's a powerful way of doing many things and for many use cases," he said. However, after the FTX misstep, Bravo emphasized that from an investment perspective, he and his firm have moved on from crypto.
FTX’s downfall, from a high-profile player in the crypto space to a financial disaster, serves as a cautionary tale for other investors. While blockchain remains a promising technology, Thoma Bravo’s retreat from the space underscores the risks associated with the volatile world of cryptocurrencies.
Peter Smith
