Orlando Bravo Says AI Valuations Are In A Bubble Territory: Report

Orlando Bravo, the billionaire tech investor and co-founder of Thoma Bravo, reportedly said that artificial intelligence company valuations are currently “at a bubble” level, drawing parallels to the dotcom era.

However, in an interview with CNBC, Bravo highlighted a key difference currently, which is that big companies with “healthy balance sheets” are the ones financing AI businesses.

Bravo’s private equity firm manages over $181 billion in assets as of June, with a core strategy focused on buying and selling enterprise tech businesses, many of which are concentrated in the cybersecurity sector.

Bravo told CNBC that investors can’t value a $50 million annual recurring revenue company at $10 billion. “That company is going to have to produce a billion dollars in free cash flow to double an investor’s money, ultimately,” he said.

“Even if the product is right, even if the market’s right, that’s a tall order, managerially,” Bravo said. He noted that the current AI landscape differs significantly from the dotcom crash. “Now you have some really big companies and some big balance sheets and healthy balance sheets financing this activity, which is different than what happened roughly 25 years ago,” he said.

The billionaire stated that his firm is exploring opportunities in software and views artificial intelligence as a catalyst for industry growth. “With AI, you have so much more to sell them, agentic solutions, an easier way for the customer to engage with your product,” he said. “That is a big, big, new, exciting tailwind for the industry.”

In 2025, AI stocks have seen a surge in valuations as they heavily invest in data centers and chip manufacturing to capitalize on the growing demand. Nvidia’s stock has gained over 38% this year, Oracle shares have risen 68% and Qualcomm has seen an 8% increase year-to-date.

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