'More pain to come' for tech industry warns Thoma Bravo founder

Orlando Bravo says the industry has a 'operating problem'

Thoma Bravo's founder has warned there is "more pain to come" for the technology industry amid high inflation and rising interest rates.

Orlando Bravo says the "real issue" for the industry is that it is "being repriced" and that it has an "operating problem".

Despite having led the stock market for years, tech stocks have taken a beating in 2022 with markets continuing to dip.

Valuations have been slashed in both the public and private markets, with companies that benefited from the Covid-19 pandemic getting hit harder than others.

And billionaire investor Bravo believes the worst is not yet over. He told CNBC: "I think there is more pain to come.

"When those companies really start getting down to answering the investor question, the path to profitability, they're not going to love what they see."

Tech firms prefer prioritising growth over short-term profitability, with higher rates making future earning less attractive.

"That requires a lot of cost reductions, it requires a lot of pain. And it's difficult to execute especially in a public setting," Bravo said.