In October 2022, the activist investor Starboard Value bought 7% of a small provider of Data Center Solutions.

On month later, ChatGPT was released.

The Data Center market exploded, and the stock is up 12x in 2 years.  A masterclass in activism investing (or market timing)🧵

1) Data Center and Vertiv Overview
2) Data Center Tailwinds
3) Lack of Urgency
4) Valuation Discount
5) Margin Opportunity
6) Multiple Opportunity 1) Data Center and Vertiv Overview

To understand Vertiv, you need to understand its end market data centers. 

Google defines data center is a physical facility that houses computing and networking equipment, used to store, process, and distribute an organization's critical data and applications, essentially acting as a centralized location for managing large amounts of digital information. 

Vertiv sells into some of the most attractive areas of the data center market including the racks (where the GPUs are placed), power supply, cooling systems, testing services, and software management

My second year as a Private Equity Associate in Large-Cap Private Equity - A Long Thread

We talk about PE all the time, but how does it look like from the inside? Today, I will cover the following topics:
1) Where I was right last year
2) Where I was wrong last year
3) Why Private Equity is such a good model
4) Key Trends I am seeing (Retail, Returns, AI)
5) Is the grind in PE still worth it?
6) Figuring things out, what I am doing next

The beautiful thing about being anonymous is that I can be 100% honest. Be aware, this is as real as it gets!

Let’s get into it ⬇️ ⬇️ ⬇️ 1) Where I was right

What I love about writing and posting content online is that I get to crystallize my thoughts. Last year, after my first year in large-cap PE, I wrote down many thoughts which I encourage you to read before diving in this new writeup (I have not repeated myself, and this post serves as a follow-on, building on what we discussed last year).

Looking back, I was at times naive, but my opinion is largely unchanged on a variety of topics, including:

i) PE is just such a good model

Last year, I wrote: “Sometimes, the private equity model seems too good to be true. Where else can you find a model where: (a) you can screw up for years and investors cannot leave you (as capital is locked up), and (b) you mark your own portfolio companies until you sell them whenever you want them?

Everyone always talks about the illiquidity premium, but I think that the positives of illiquidity are often overlooked. There is a certain comfort of looking at a 20% market pull-back knowing that (a) you are not going to charge the multiple of your portco (because private market multiples are more stable - big surprise lol), and (b) every public target just got 20% cheaper.”

Early this year, markets crashed 20%+ and this felt so true. No one was particularly scared, our marks stayed really flat (lol), and it was much easier to make the math work on many public names. While I never experienced a long recession in private markets, no one can argue that this lock-up structure is extremely advantageous and also prevents GPs from panic-selling.

ii)The hard part is getting in

From the outside, large-cap Private Equity can seem intimidating. Everyone has an MBA from HBS/GSB, went to a top undergrad and top-tier banking program, etc. etc. - the cream of the crop

My view is that large-cap PE really attracts above-average smart, insecure, and money-driven individuals.

Maybe this is a bit harsh, but I just really want to share that the average IQ is not 160. These are (mostly!) a bunch of people who generally like investing, really want to get rich, and are not willing to take a risk (there are many fantastic individuals I work with who I consider brilliant, but these are the exception, not the norm).

What should you do with this piece of information?
Firstly, you should not be intimidated by someone just because they are a Principal at a Mega-Fund, it is really just a job.

Second, you should not despair if for some reason, you don’t get one of these firms. There is a large number of variables you cannot control when the recruiting process is so selective, so just don’t sweat it, this is not the best job in the world.

Finally, if you get a job and want to spend your career there, this can be done. I often hear complaints that all these Large-Cap PE programs are two-and-out. My view is that if you are actually smart and really want to get a promotion, there is room. It is up to you to get it (and decide this earlier than later).

iii)You are not an investor

I love when people update their LinkedIn profile to “Investor at [Insert Mega-Fund]” because it is just so cringe when you look at what the job actually looks like.

If you define investing as doing models to backsolve to a 20% IRR, make twenty-page, nicely formatted decks, and help a deal get through and manage advisors, then yes, you can call yourself an investor. But if you think about investing in a more classic way, I am sorry to break it to you, but you will not be one until you are much more senior.

This creates a lot of friction at the junior level because people get frustrated that they are still Excel monkeys and no one wants to ask you what you think about the business.

In PE, the Investment Committee makes a decision, and the Partner makes a recommendation; you are just there to help him pitch the company. Just something to understand before having your dreams crushed.

Beyond IRR: Why is everyone talking about DPI? 🧵

The dry-up of IPO and M&A markets, combined with a 'higher for longer' interest rate outlook, has led an increasing number of LPs to rank DPI as their 'most critical' performance metric in 2025 (McKinsey). However, even this inherently cash-based metric is not a panacea and has its own natural limitations.

Let’s have a closer look at DPI’s ascendance in the PE world:

1) What is DPI – the fund’s cash-on-cash reality
2) PE Liquidity crunch: the main drivers of DPI's recent prominence
3) Liquidity management tools: a double-edged sword
4) The shortcomings of IRR
5) Demand for DPI is here to stay
6) DPI and IRR: a holistic view 1) What is DPI – the fund’s cash-on-cash reality

DPI is a straightforward metric that quantifies the total capital a private equity fund has returned to its investors relative to the total capital they have contributed. It is calculated by dividing the total cash distributions to investors by the total capital paid into the fund:

DPI=Distributed Capital / Paid–in Capital

This ratio provides a clear, tangible measure of a fund's ability to return actual cash, and is also a net metric, since it is calculated after fees and expenses. For instance, a DPI ratio of 1.5x indicates that for each dollar invested, $1.50 has been distributed back to the LP.

One of the key factors that’s responsible for DPI’s recent protagonism is the fact that, unlike IRR, it does not rely on theoretical valuations or projected gains – it aims to answer the question of “How much actual money has been returned compared to what was invested?”

Furthermore, DPI also functions as a strong indicator of a GP's execution capability and operational discipline – the direct correlation between DPI increasing as exits are achieved and capital is distributed positions this metric as a clear measure of a fund manager's effectiveness to in successfully liquidating investments.

Finally, DPI avoids IRR’s oftentimes unrealistic assumption that the funds distributed to the LP can be reinvested at the same rate of return.

DPI will largely change as the funds progress in its J-curve. Intuitively, a DPI below 1.0x is expected during the fund’s investing phase, up to the closing of the first exists of the fund, and to increase past 1.0x as the fund successfully liquidate its investments – the key aspect here being the timely exit of those positions. If funds are facing problems to exit their portfolio companies at the desired conditions, they may extend the holding period, pushing the payday for LPs (e.g. the distribution) further in time and maintaining DPI at lower levels.

On July 11, Walgreens Boots Alliance shareholders approved a $23.7bn take-private by Sycamore Partners.

But you probably don’t even know the biggest winner in this saga so far.

It’s Warburg Pincus - who quietly walked away nearly three years earlier after one of the most successful exits in its healthcare portfolio (10x+ MOIC).

This is the story of how Warburg built and exited Summit Health, what made the deal work, and why Walgreens is still trying to make sense of it:
1) Betting on CityMD
2) Tuck-Ins and the Summit Merger
3) The Strategic Sale Process
4) VillageMD and Summit Health
5) Reality Hits and the Sycamore LBO 1) Betting on CityMD

In 2017, Warburg Pincus acquired a majority stake in CityMD, a high-growth urgent care provider in the New York metro area. At the time, the company had 68 locations across New York, New Jersey, and Washington, was generating roughly $240mm in revenue, and had under $40mm in EBITDA. The deal valued CityMD at $596mm, implying a 2.48x EV/revenue multiple and ~15x EV/EBITDA.

Though Warburg wasn’t actively targeting urgent care, it was drawn to CityMD’s aftercare referral model and dense urban footprint. TJ Carella, head of healthcare at Warburg, later said the company was impressed with how CityMD integrated episodic care into the broader healthcare system. The investment is part of a broader trend occurring in PE; by 2024, nearly 17% of urgent care clinics were PE-backed according to the Journal of Urgent Care Medicine.

Warburg had already invested more than $10bn in healthcare by that time, in companies like Alignment Healthcare, Coventry Health Care, and Humana. CityMD was another bet - but one that would evolve significantly.

TRIPLE DIP DEEP DIVE

A structure that is just arising in the restructuring / credit world is the triple-dip.

At the most basic level, the point of a triple-dip is simply to take a double dip, and determine if there is another claim that can allow a creditors claim to reach three times the book value of debt. 

The case of Spirit Airlines, which we dive in our deep dive, is the first iteration of this mechanic and evidence that triple-dips can be created if the correct verbiage exists in credit documents.

For Spirit, a third dip was created via Termination Damages, as the bond indenture included a clause specifying the cost of damages owed to bondholders if the brand IP licensing agreement is terminated.

The other two dips came from the sources above: the ParentCo guarantee and an intercompany loan. 

That does pose the question: what are some other ways a triple-dip could be created.

Although it is always going to depend on the credit doc, corporate structure, and what creditors are allowed to do, below are some possible ways that I have thought a triple-dip could be created:

1) Option 1: Subsidiary Structuring
2) Option 2: Intercompany Derivative/Capital Structure Instruments Structuring
3) Option 3: Contingent Convertible Capital Securities

A (very complex) Thread 🧵----> 1) Option 1: Subsidiary Structuring

This is the most natural extension of a double dip

As a reminder, in a double-dip, we gain two claims from an intercompany loan and a guarantee.

Although it may seem simple to create a new subsidiary and provide another intercompany loan, for example, to get a third claim, this would not actually provide a triple-dip as this new intercompany loan still requires capital from a creditor group.

Thus, to create a triple-dip ‘naturally’, we need to maneuver the existing capital around the corporate structure to gain an additional guarantee secured by the same pool of assets.

Reference figure below for an example to demonstrate this idea.

While this diagram may look complicated, it is simply an extension of the double-dip seen.

In this example, we have $400mm of Secured Notes being issued to SubCo Y. As in a standard double-dip, we have our first claim coming from an intercompany loan to the ParentCo.

Our second dip comes from the guarantee from the restricted subsidiary on the $400mm debt issued by the triple-dip creditors. Now, to create the third dip, we need to gain an additional claim (outside of the credit box).

To do so, one method could be to transfer the debt held at ParentCo to SubCo X via an intercompany loan.

The debt held at SubCo X can then be guaranteed again by the Restricted Sub, creating a third claim. In order to move assets in and out of the credit box like the example above, there needs to be a lot of credit doc flexibility.

Life insurance is reshaping credit markets and its impact on restructuring will be game-changing.

Remember when the most dramatic part of a restructuring was a fight over Debtor-In-Possession
(DIP) pricing or a heated meeting about covenants? Well, today, the real drama happens inside the
balance sheets of Megafunds.

Here’s what you need to know about how insurance-backed capital is becoming Megafunds’ quiet force steering distressed deals and how Apollo, KKR, and Brookfield specifically are turning life insurance into a secret weapon
1) Insurance 101
2) Why you should care
3) Apollo x Athene
4) KKR x Global Atlantic
5) Brookfield x American National
6) The Forced-Sale Trigger
7) Bottom Line Insurance 101
Life insurers aren’t piling into credit because they’ve suddenly discovered their inner hedge-fund
manager. They’re doing it because they’ve promised policyholders a fixed annuity check every
month until 2055.

To keep their promise, they need medium-yield assets that can securely hum along for decades. Enter distressed loans, structured credit, and even DIP financings

In short, life insurance liabilities = very long-dated bonds.

When a client buys an annuity, the insurer
is on the hook for payments 10-50 years out.

The present value of those obligations is discounted
using interest-rate curves, and if rates fall, the liability’s value jumps, and regulators demand more
capital padding.

Asset-liability matching is the name of the game here. Life insurance companies are less worried about beating the S&P and more worried about simply making sure assets and liabilities stay in sync.

If an insurer can achieve a predictable 6-8% over 30 years instead of pulling a Structured Alpha 2.0
their CIO will keep their job.

Private Wealth is the next big source of capital in private markets.

This is Kipp deVeer. He is the Co-President of Ares, and in his most recent interview with Capital Allocators, he discusses Ares’ focus on the source of capital of the future: private wealth.

1) Private Wealth: Overview
2) Ares Approach
3) Investment Implications
4) Geographic Expansion
5) Ares’ Future

A (Long) Thread 🧵 1) Private Wealth: Overview

Kipp notes that the mass affluent of high-net-worth individuals (HNWI) have a growing desire for more sophisticated portfolios beyond the traditional 60/40 allocation, following negative returns in the early 2020s. With the growing prevalence of alternatives, private wealth managers view the sector as a substitute.

A decade ago, the channel was mostly limited to non-traded REITs, with Blackstone holding 60% of the market share. Since then, product innovation has widened offerings, from secondaries funds to private credit strategies. ‘40-Act wrappers have underpinned this shift and are the vehicles that allow HNWIs to enter the less-liquid markets. Two key examples of ‘40 Act wrappers within the private credit space include Business Development Companies (BDCs) and Interval Funds:

1. Business Development Company - Listed or non-traded, a BDC pools private credit assets, and like REITs, passes most of the investment income through dividends [2]. BDCs dominate debt-focused ‘40 Act funds, holding roughly $340bn of the $400bn segment [3].

2. Interval Funds - These funds offer “semi-liquidity,” allowing redemptions only at scheduled monthly or quarterly intervals. This illiquidity allows managers to own harder-to-trade assets, such as alternatives or private credit, without daily pressure [4]. Interval Funds now account for about $50bn of the debt-focused ‘40 Act funds.

Market share is heavily concentrated, with just four or five mega-funds, such as Ares, Blue Owl, and Blackstone, controlling over a third of the private wealth channel. The expansion of private wealth extends beyond more stable asset classes like private equity or credit, but also to VC. Benchmark’s Bill Gurley remarked in a recent podcast that Coatue is also exploring an interval fund, allowing HNWIs to delve into the space.

COATUE East Meet West Deck

102 Pages on Public Markets every investor should read

My highlights 🧵

1/ Tech Trends - higher returns & volatility
2/ Change in Stock Leadership - hard to stay on top
...
10/ The AI Flywheel
11/ Long the $USA 1/ Tech Trends - higher returns but more volatility and drawdowns

🚨 Private credit helped build a boom. Now it’s creating a mess.

Distress is spiking across the middle market, but not the kind we’re used to…

More firms are failing by accident than by design. And many lenders? They’re learning workouts in real time.

SCP CEO Lawrence Perkins breaks it all down on Bloomberg’s FICC Focus.

Here are my insights that every operator, sponsor, and creditor should know 🧵 1) Rise of “Distressed-by-Accident” Cases

Perkins observes a growing cohort of workouts he calls “distressed by accident." These are situations where overly aggressive financing (often from private lenders) unintentionally pushes a company into trouble, rather than a planned restructuring.

In his words, he’s seeing “more ‘distressed by accident’ lenders these days, courtesy of the private credit boom, than the ‘distressed on purpose’ ilk.” For restructuring professionals, the implication is clear: sponsors and advisors must monitor covenant-heavy deals closely.

Even healthy companies can suddenly trigger defaults, so early warning signs must prompt prompt action. In practice, this means conducting stress tests and engaging lenders before a crisis spirals out of control.

Apollo’s $800bn Credit Revolution: How to Turn Cheap Liabilities into a Global Origination Machine—and Why It Matters for Every Portfolio in the World

Wall Street’s usual private-equity tale ends with a splashy IPO.

Apollo Global Management has written a different sequel

It has turned itself into the world’s most sophisticated credit factory, originating more than $250bn of debt every year and warehousing much of it on its own $330bn insurance balance sheet.

John Zito—once a credit hedge-fund trader, now Apollo’s Co-President—recently unpacked that evolution on the Invest like the Best podcast.

1) From Hedge‑Fund Desk to $800bn Platform
2) Why the Athene Merger Changes the Game
3) Rewriting the Rules for Investment‑Grade Borrowers
4) The Origination Flywheel in Practice: Atlas and Beyond
5) Carvana: A Creditor Co-op That Rewrote the Playbook
6) The Cultural Operating System: “Thumbs, Not Fingers”
7) What the Model Means for Ordinary Investors
8) Where the Capital Will Flow Next: AI Infrastructure and Beyond
9) Hertz, Re-Examined: An Inside-Out Playbook 1. From Hedge‑Fund Desk to $800bn Platform

When Zito started trading in the early 2000s, bank loans did not even have tickers; they sat inert on commercial‑bank balance sheets. Credit default swaps (CDS) were a novelty, and a $1bn hedge fund seemed vast.

Two decades later the liquid loan market surpasses $500bn in annual issuance, and Apollo by itself manages almost that amount across liquid, illiquid, and captive insurance pools.

The through‑line is scale. A traditional asset manager invests a client’s money and charges a fee. Apollo still does that, but after its 2022 merger with retirement-services giant Athene, it now directly manages—and takes first-loss investment risk on—roughly $330bn of long-dated insurance float.

That capital ultimately belongs to annuity holders, yet the assets and equity cushion sit on Apollo’s consolidated balance sheet, giving the firm “skin in the game” on every coupon and principal payment it earns.

That structure reshapes incentives inside the firm. Instead of asking each desk to maximise its stand-alone carry, senior leadership asks a simpler question: Where does this asset live best along our “good-better-best” continuum of balance sheets?

A 30-year senior-secured loan on a hyperscale data-center campus might drop straight into Athene; a five-year, second-lien term loan backing a private-equity carve-out could slot into the Hybrid Value fund; an opportunistic block of stressed airline bonds might sit in the liquid-credit sleeve Zito once ran.

Because carry, fees, and principal co-invest all flow back to the same P&L, originators focus on total-firm economics rather than turf defence—“every asset has a natural home, so nobody is swinging a single hammer hoping everything looks like a nail.”

Bain Private Equity Midyear Report 2025

The cracks are starting to show

1) Global buyout deal value
2) Global buyout-backed exit value, by channel ($B)
3) Median buyout DPI, by vintage year
4) Global buyout capital raised ($B)
5) Ratio of capital sought to funds closed in year

Thread 🧵 1) Global buyout deal value, by region ($B)

While deal value was the highest since the second quarter of 2022, having been boosted by a few large transactions, such as Sycamore Partners’ $23.7 billion purchase of Walgreens Boots Alliance, deal count is still at very low levels - less than 50% from 2021 levels

Everything you need to know before starting your IB/PE job - 3,000 words of (very detailed) advice

Every day, ask yourself: "Am I being the best analyst / if they had to fire all analysts but one would they keep me? What can I do differently to become that analyst/associate?"

Even if you are already working, I hope you can find something that will save you some time.

1) Working efficiently
2) Communicating effectively
3) Being professional
4) Balancing work with personal life 1) Working efficiently

Part 1

DECODING GP STAKES

Is GP stakes investing the next frontier in private equity? Sean Ward and Blue Owl Capital are redefining long-term growth with permanent capital.

Sean Ward’s path to Blue Owl is far from ordinary. With a blend of Wall Street, PE, and legal experience, he’s leading Blue Owl’s GP Strategic Capital platform. They aim to forge lasting, value-driven partnerships with fund managers.

Here are my biggest takeaways from Sean’s conversation on Alt Goes Mainstream podcast (what a name!):

1) Blue Owl’s Early Entry into GP Stakes Investing
2) The Minority Investment Model
3) Sources of Return in GP Stakes Investing
4) What It Takes to Succeed in GP Stakes Investing
5) Targeting the Middle Market for Long-Term Growth
6) GP Stake Ecosystem in Private Market
7) Power of Permanent Capital in Securing Future Success 1) Blue Owl’s Early Entry into GP Stakes Investing

Blue Owl’s entry into GP stakes investing was a pivotal moment in the industry. Sean Ward's career took an unexpected turn after his time as a lawyer at Lehman Brothers during its 2008 bankruptcy. He transitioned into a hybrid legal-business role.

Ultimately, he helped spin out Lehman’s investment management division. This led to the creation of Newberger Berman. This evolution eventually turned into Blue Owl’s successful GP stakes platform.

In the early days, the firm set a modest goal of raising $300 million. However, their first fund ended up raising $1.3 billion. Over time, Blue Owl’s latest fund raised nearly $13 billion. The firm now holds 90% market share in large transactions.

The journey wasn’t without challenges. Fundraising was difficult, and convincing General Partners (GPs) to sell stakes in their firms was tough. GPs feared that selling a part of their business might make them seem misaligned with investors.

As time passed, GP stakes investing gained more acceptance. This shift was especially seen among larger firms. They recognized that external capital was essential for funding growth. GP stakes investing is now seen as a necessary tool for scaling up.

Buffett: "Big drawdowns are a price to pay for superior long-term investment returns"

@mjmauboussin latest paper analyses drawdowns and the art of making money in these periods

Thread🧵
1) Average Drawdown - 85% / 2.5 years
2) Drawdown Duration and Recoveries Stats
3) Buy the 95% drawdown
4) Even God Would Get Fired
5) Case Study 1: NVIDIA
6) Case Study 2: Foot Locker
7) What To Look For at the Bottom 1) Average Drawdown - 80%

Crazy stat by looking at the overall market.

What is even more interesting is that even the best businesses are not immune to large drawdowns

If we look at Apple, Microsoft, NVIDIA, Alphabet, Amazon, and ExxonMobi, the average maximum drawdown for the stocks of these 6 companies was 80.3 percent, similar to the average of the full sample

Wall Street lives quarter‑to‑quarter

Sir Chris Hohn of The  Children’s Investment Fund (TCI) underwrites to 2040

That patience has minted a $60 billion titan whose winners outlive entire market cycles—and whose performance fees bankroll one of the world’s largest child‑health and climate charities.

Here’s how: time arbitrage, moat‑first screening, and a no‑bureaucracy culture that lets ideas age like wine.

Below, seven longevity lessons from his interview with NBIM’s Nicolai Tangen on the ‘In Good Company’ podcast—from holding Moody’s through crisis to re‑entering at triple what it bought it for —showing why slow money can still beat fast crowds.

1) TCI: Building a $60 Billion Giant with Eight People
2) Chris Hohn’s Checklist for Fortress Businesses
3) Mental Models That Compound Capital
4) Why Moody’s Looked Unstoppable (and what it teaches about price vs. profit)
5) The Activist Years – Fighting, Winning, Adapting
6) Wirecard & Safran: Holding Through Chaos
7) Hard Lessons & Higher Purpose 1) TCI: Building a $60 Billion Giant with Eight People

In 2003 Chris Hohn quit a well‑paid hedge‑fund seat to start TCI with roughly $500 million. Today assets hover near $60 billion, yet the investment team still fits around a conference table—seven to eight analysts and partners.

Indeed, a notable firm alum and ex-partner is Rishi Sunak - United Kingdom's previous Prime Minister

Hohn copied a private‑equity mindset into public markets. While a typical mutual fund holds hundreds of names for twelve months or less, TCI owns ten to fifteen positions for as long as a decade. That patience is not laziness; it is the firm’s first structural edge. Markets seldom price what happens after year three. Hohn is happy to wait until year eight.

Culture protects the edge. He argues great analysts will not tolerate bureaucracy or politics. Keep the head‑count tiny, force every idea to withstand direct debate, and let trust replace process check‑lists. Above ten professionals, he says, the cohesion breaks down.

MEGA-FUND PRIVATE EQUITY RETURNS

We hear it all the time, Mega-Funds are trying to maximize capital aggregation vs. returns

What do the numbers actually say?

A thread on the returns of:
1) Blackstone - Bad
2) KKR - Bad
3) H&F - Mid
4) Silver Lake - Mid
5) Thoma Bravo - Mixed
6) Permira - Mixed
7) Warburg Pincus - Good
8) Concluding Thoughts 1) Blackstone

2015 Vintage: 0.85x DPI - marked at 12% IRR

2019 Vintage: 0.18x DPI - marked at 9% IRR

This is, obviously, bad.

It has been 10 years since the 2015 vintage and LPs are yet to get their entire contributions back. The 2019 vintage is a bit early in their lifecycle, but seems to be doing even worse, and it is quite possible this fund includes some very high-multiple deals from Covid.

I guess you can't get fired for giving your money to Blackstone, but this is rough

On-Cycle PE Recruiting is Paradise

Sooo good

1/n 2/n

David Senra has studied 400+ biographies of the world’s greatest builders, including Jobs, Dyson, Chanel, Graves, Walton, and uncovered the same characteristic: Obsession.

On ILTB, Senra shares the clearest blueprint yet for how to build something that lasts. Here are the main points he talked about:
1) Focus
2) Compound
3) Simplicity
4) Obsession
5) Grit
6) Talent
7) Consistency 1) Focus
Senra says if you distill 400 biographies of iconic founders into one word, it’s “focus.” Real focus: it’s a long, painful, monastic obsession with a single idea.

James Dyson worked 14 years on 5,127 vacuum prototypes before launching. Steve Jobs spent every Wednesday in 3-hour marketing meetings reviewing one ad at a time.

Coco Chanel stayed locked into her aesthetic vision for half a century. Todd Graves built a Raising Cane's chicken finger empire without ever adding a salad to the menu.

While the rest of the world is switching tabs and chasing investors’ money, the best founders tune everything out and run the same play.

Thoma Bravo, one of the most prolific software investors in private equity, has built a reputation for taking legacy software firms and transforming them into modern, high-margin platforms.

Its carveout of Dynatrace is a standout example — a complex transaction that required not just operational chops but true conviction in a long-term transformation.

Thoma Bravo Partner Chip Virnig and former Dynatrace CEO John Van Siclen break down:
1) Description & History of Dynatrace
2) Why Dynatrace Was a Fit for Thoma Bravo
3) The Carve-Out & Transformation Strategy
4) Adding Value Post-Acquisition
5) Lessons Learned & Reflections

Here are my notes 🧵 —> 1) Description & History of Dynatrace

Founded in 2005 (Linz, Austria); acquired by Compuware in 2011; spun out by Thoma Bravo (via Compuware buyout) in 2014. Merged with TB’s Keynote Systems in 2015. The IPO was completed in 2019.

A pioneer in application performance and digital observability. Dynatrace’s platform provides multicloud application monitoring (public cloud, SaaS, managed) to ensure enterprise software runs optimally. It effectively created the “Digital Performance Management” category.

Now headquartered in Waltham, MA (with R&D globally), Dynatrace has grown to a market cap near $15–16 billion. It reports well over $1 billion in annual cloud-based recurring revenue (from essentially zero at TB’s entry).

COREWEAVE IPO

The largest tech IPO since 2021, selling AI as a service, you must understand it.

1/ How does CoreWeave make money?
2/ Attractive Unit Economics?
3/ Revenue Profile / Concentration
4/ Capital Needs and Debt
5/ Ending Thoughts

A Thread 🧵 1/ How does CoreWeave make money?

They rent out GPUs and get paid per hour

"We generate revenue by selling access to our AI infrastructure and proprietary managed software and application services through our CoreWeave Cloud Platform.

Access to our platform, including compute, networking, managed software services, and application software services, is currently priced on a per GPU per hour basis.

Storage is sold separately on a per gigabyte per month basis."

Hamilton Lane published its annual 100+ pages market review

- Private markets vs public markets
- Deal valuation
- Primary buyout vs sponsor by sponsor trends
- Fundraising

A lot to dive in!

1/16 🧵

DPI by Vintage Year 2/ IRR by Vintage

1) Venture had such an amazing run in the early 2010s

2) Nat Resources really struggled for years

3) Public markets still outperformed a significant number of private markets asset classes. This said, comparing risk is really hard given the different nature of the asset classes