Private Equity-Driven Tech Consolidation: Thoma Bravo's Olo Acquisition and SaaS Valuation Dynamics

Private equity firms have long been pivotal in reshaping the technology landscape, but their influence has intensified in 2025 as SaaS valuations face renewed scrutiny. Thoma Bravo's $2 billion acquisition of Olo—a leader in restaurant digital ordering—exemplifies this trend, offering a case study in how private equity strategies are recalibrating the SaaS ecosystem. By dissecting this deal and broader market dynamics, investors can better navigate the interplay between consolidation, monetization, and valuation metrics.

Strategic Rationale: Payments and Platform Expansion

Thoma Bravo's acquisition of Olo underscores its focus on embedded payments and platform stickiness. Olo's $10.25-per-share offer, a 65% premium over its unaffected price, reflects the firm's confidence in the company's dual strengths: a 40% market share in digital ordering and a growing payments business that now accounts for 20% of revenue Olo Enters into Definitive Agreement to be Acquired by Thoma Bravo^[1]. This aligns with Thoma Bravo's playbook, as seen in its $8 billion acquisition of Coupa Software, where embedded payments (via Coupa Pay) became a $7 trillion transaction engine Thoma Bravo's Acquisition of Coupa Highlights the Value of B2B SaaS and Embedded Payments^[2]. By integrating Olo into its portfolio, Thoma Bravo aims to replicate this model, leveraging Olo's 1,200+ restaurant clients to monetize transaction volumes and expand into guest engagement tools like loyalty programs Olo Enters into Definitive Agreement to be Acquired by Thoma Bravo^[1].

Noah Glass, Olo's CEO, emphasized that the partnership would accelerate the company's mission to “create a world where every restaurant guest feels like a regular” Olo Enters into Definitive Agreement to be Acquired by Thoma Bravo^[1]. This vision aligns with Thoma Bravo's emphasis on high-retention SaaS platforms, a critical factor in sustaining valuation premiums. As the firm's co-president, David A. Kaplan, noted in a recent investor call, “We target businesses with defensible market positions and clear paths to monetizing adjacent services” Global M&A trends in financial services: 2025 mid-year^[3].

SaaS Valuation Trends: Public Premium and Private Realities

The Olo acquisition occurs amid a widening valuation gap between public and private SaaS firms. As of 2025, public SaaS companies trade at a median 7.0x EV/Revenue, while private peers command 4.8x to 5.3x Thoma Bravo's Acquisition of Coupa Highlights the Value of B2B SaaS and Embedded Payments^[2]. This 36% public premium—consistent with 2024 trends—reflects liquidity advantages and investor confidence in established revenue streams Olo Enters into Definitive Agreement to be Acquired by Thoma Bravo^[1]. However, private equity-backed SaaS firms like Olo are closing this gap through strategic acquisitions and embedded monetization.

Thoma Bravo's approach highlights the importance of diversified revenue streams. For instance, Coupa's transition from a pure-play spend management platform to a payments-centric model boosted its valuation multiple by 2.5x within two years Thoma Bravo's Acquisition of Coupa Highlights the Value of B2B SaaS and Embedded Payments^[2]. Similarly, Olo's payments business, which generates 30% gross margins, could justify a higher multiple post-acquisition by reducing reliance on subscription-based ARR Olo Enters into Definitive Agreement to be Acquired by Thoma Bravo^[1].

Portfolio Monetization: The Thoma Bravo Model

Thoma Bravo's monetization strategies extend beyond traditional SaaS metrics. The firm's $3.6 trillion “exit logjam”—a backlog of portfolio companies awaiting liquidity events—has spurred creative exits, including secondary buyouts and strategic sales Global M&A trends in financial services: 2025 mid-year^[3]. The Olo deal, for example, allows Thoma Bravo to consolidate its restaurant tech holdings while avoiding the volatility of public markets.

This strategy is particularly relevant in 2025, as financial services M&A surged 15% year-to-date, driven by demand for tech-enabled transformation Global M&A trends in financial services: 2025 mid-year^[3]. By acquiring Olo, Thoma Bravo positions itself to capitalize on the $120 billion U.S. restaurant tech market, where digital ordering and payments are projected to grow at 18% annually Olo Enters into Definitive Agreement to be Acquired by Thoma Bravo^[1].

Implications for Investors

For investors, the Olo acquisition signals three key trends:
1. Payments as a Growth Lever: SaaS firms with embedded payments capabilities are increasingly attractive, as they offer recurring revenue and margin expansion.
2. Valuation Arbitrage: Private equity firms are exploiting the public-private valuation gap by acquiring undervalued SaaS platforms and scaling them through strategic integrations.
3. Sector Consolidation: The restaurant tech sector, like others, is seeing consolidation as private equity firms seek to dominate vertical-specific ecosystems.

However, risks persist. The public SaaS premium remains volatile, and regulatory scrutiny of private equity's role in tech could impact future deals. Investors must also weigh the trade-offs between high-growth SaaS bets and the stability of private equity-backed platforms.

Conclusion

Thoma Bravo's acquisition of Olo is more than a strategic win for the firm—it's a microcosm of the broader shift in SaaS investing. As private equity firms refine their monetization strategies and SaaS valuations evolve, the industry's next chapter will likely be defined by those who can balance innovation with disciplined capital deployment. For investors, the lesson is clear: in a consolidating market, the ability to identify and scale embedded value will separate winners from losers.