Why the SaaS Sell-Off Is Creating Generational Buying Opportunities
2026-03-29 16:05:00 ET
The sell-off in software-as-a-service (SaaS) stocks could be creating a generational buying opportunity in the group. At least this is the view of Thoma Bravo, which is widely regarded as one of the top private equity investors in the SaaS space. It has taken many SaaS companies private over the years, and it currently owns about 80 software companies.
In a recent presentation, Thoma Bravo noted that SaaS stock fundamentals have moved in the opposite direction from their valuations. It noted that fundamentals are improving with about 20% annual SaaS growth expected over the next few years. Meanwhile, SaaS companies in the S&P 500 are growing their revenue at three times the rate of companies in other industries while having considerably higher gross margins .
That said, Thoma Bravo's presentation wasn't a blanket defense of the entire industry. It argued that not all software companies are alike and that some will eventually get disrupted by AI. However, the firm believes that SaaS companies with deep domain expertise will become winners in the agentic AI age.
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