Rhetorical question – Been to FTX? Yes, this platform who just raised $1 billion and still seems more unstoppable ? Well, it’s not her we’re going to talk about today, but one of her investors. He therefore responds to the name of Orlando Bravo. He built one of the largest private equity funds, private equity for bilinguals. This billionaire spoke about the current situation of “unethical cryptocurrencies” compared to private equity.
Cryptos are unethical compared to private equity
In Cannes, on September 26, during the private equity conference, the billionaire and co-founder of Thomas Bravo defined the cryptocurrencies as unethical. Let’s put away our forks, this director of a firm estimated at $7 billion holds shares in FTX. He also personally defended the Bitcoin. During an interview, he lamented the fact that the ethical standards in the crypto industry are not as high as in private equity.
His PE group has invested $150 million in the famous FTX cryptocurrency exchange. The company also has interests in 4 other firms of the sector. However, he reportedly said in an interview with FinancialTimes that his firm would put a stop to the development of investments in crypto companies. Of course, the manager of Thoma Bravo is satisfied with the performance of his company. However, he testifies that he met problems in the industry at large.
“I’ve gotten to know this world a bit more, and some of the business practices don’t live up to the ethics that we’re all used to in the private equity space with your investors, your clients, and your community. , and it was a little disappointing. »
Orlando Bravo, Head of Private Equity at Thoma Bravo
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But the billionaire bets on 5 crypto horses
The entrepreneur is like this optimistic compared to Bitcoin and cryptocurrencies. However, he feels that the industry is showing a worrying lack of transparency. He relativizes his remarks by stating that the industry is young and that the problems will be solved with the time. As a reminder in January, he said that cryptocurrencies were theultimate store of value.
The other companies in which Thoma Bravo has invested are Anchorage Digital, Falcon X, figure and TRM Labs. For these investments he therefore raised a growth fund last year from $1.5 billion.
Regarding these future crypto investments. He stated:
“We are doing more of what has been very, very successful. And if something isn’t done yet, we don’t rush to do another 10 things. We’re really happy with what we have. And we want to see it grow and succeed before we can do much more. »
He also expressed that they would “definitely consider”invest in FTX again. And this in the event that it organizes another round of financing. The company will be “a big winner,” he said, describing Sam Bankman-Fried30, as “one of the best entrepreneurs” he has ever met.
Private equity, really ethical? At large ?
Like any new market, the cryptocurrency market has not matured and problems ethical, safe, environmental remain to be resolved. Private equity, while facing regulations, is not left out either.
Private equity companies are the companies that come after venture capital companies. In short the investment is less riskyso he pays less. A private equity firm will invest in a company whose business plan has already been tested. They generally invest for 5 years in order to help the company grow and develop.
But these companies are all subject to criticism. These companies are sometimes accused of trying to maximize profitability businesses to the detriment of their longevity. Also if the investment turns sour, there are sometimes reports of investors recovering their due and deserting places. “After me the deluge” we will say.
Obviously not all companies are like this. Many seek to develop a real relationship of trust with the projects in which they invest. Every private equity firm has specialties and an reputation which precedes it.
Another fact that drives ethics. Companies, whether private equity or not, will get credit cheaper and more easily if they are ethical. Indeed CSR scores depend on the rate of parity gender, commitments environmental and societal. These scores then generate an increase or decrease in the interest rate charged on the loan.
The cryptocurrency market therefore has progress to make. Who loves well punishes well, criticism is necessary to advance and improve any project. And if the market is not mature, so much the better.
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