The crypto industry is not as ethical as private equity, says the buyout billionaire

Orlando Bravo, the multi-billion dollar co-founder of Thoma Bravo and Bitcoin enthusiast, said he was disappointed when he found that the ethical standards in parts of the crypto industry are not as high as in private equity.

Bravo, whose Buyout group invested around $ 150 million in Sam Bankman-Frieds Frieds Fried's cryptocurrency exchange FTX and is involved in four other companies in the industry, said in an interview with the Financial Times that his company was investing investments in other crypto companies.

The private equity manager said that he was satisfied with Thoma Bravo's previous shops, but he came across problems in the entire industry.

"I got to know this world a little better, and some of the business practices do not achieve the ethical level that we are all used to in private equity with their investors and their customers and their community, and that was a bit disappointing," he said.

Bravo, who said that he personally owned Bitcoin, criticized the cryptoma market for the "disturbing" lack of transparency, as he called it. But he emphasized that he was still optimistic about Bitcoin and believed that the industry was "only young" and that ethical problems "would be remedied over time".

The profile of the bravo based in Miami has risen on a bumping basis when his private equity company has grown from a niche player to a $ 122-billion giant in recent years and has invested several ten billion dollars of investor funds in Leveraged Buyouts from corporate software companies, while the ratings have risen. His companies include the Sophos and Stamps.com based in Great Britain.

He was a loud supporter of Bitcoin, tweeted his upward movement and spoke at a Bitcoin conference in Miami. In January he wrote on Twitter that the cryptocurrency "is high as ultimate value residues".

This year the price of Bitcoin fell by 50 percent and the crypto industry was shaken by a number of crises. Terrausd, a token for tracking the dollar, has collapsed, the crypto loan platform Celsius went into bankrupt

In addition to FTX, Thoma Bravo took over minority investments to the crypto company Anchorage Digital, Falconx, Figment and TRM Labs with a growth fund. According to the PitchBook, the fund is available to a total of 1.5 billion USD.

When asked whether he would do more crypto deals in the current climate, he said: "We do more of what was very, very successful, and if something is not yet successful, let's not hurry to do 10 other things.

He said, however, that the company would "consider safely" to invest more money in FTX if there was another financing round. The crypto company based on the Bahamas will be "a big winner," he said, describing 30-year-old Bankman-Fried as "one of the best entrepreneurs" to whom he met.

Bravo's comments came when he and other dealmaker from all over the world gathered for the IPEM-Private equity conference in Cannes and as the economic conditions that have driven up in the industry for decades.

Thoma Bravo considered to provide equity for Elon Musk's offer to buy Twitter at the beginning of this year, which would have been a departure from his model of buying corporate software companies. "In terms of all key figures, it looked like a business software store," said Bravo.

Twitter is dependent on the majority of his income on advertising, in contrast to many companies in company software that achieve constant, more stable income from corporate customers that pay for the use of their products. When asked whether the two are really comparable, he said: "You have a very, very good point.. You have to be quite creative if you want to do the newer things in the software

"Can you see other companies like this?

Bravo, whose company has entered the booming market for purposes or spacs, said that the model should be designed more like private equity. Spacs was criticized for enriching the so -called "sponsors" who set up the money covers, even if the target company loses value after the IPO.

Spac from Thoma Bravo merged last year with the Israeli software company IronSource. The IronSource stocks fell from a maximum of $ 13 to $ 3.56.

"The market burned and we made a shot," he said. "There is simply a better orientation, and if people could simply copy the private equity model into a spac, it would be much better.

He said that software investments are "without a question the perfect place to cope with inflation", because with a $ 100,000 software product, a company can "relieve 50 employees or achieve much more with the existing worker".

At the beginning of the conference, Mikkel Svenstrup, Chief Investment Officer at Denmark's largest pension fund ATP, compared private equity with a pyramid system and explained that companies had sold too many companies either to other buyout groups or to their own funds. Bravo contradicted the comments.

"We sold so many companies to private equity and they cut off so well," said Bravo. "You may have a thousand ideas that you did not have in the five years of your property, and you destroy you, and that's good for you".

"People don't say.. That the public markets are a pyramid system," he added. "Fidelity buys from Capital Group, which in turn buys from a hedge fund.. You just want to do the best trade."

Additional reporting by Scott Chipolina