Thoma Bravo Loses Medallia, OpenAI Drops ChatGPT 5.5, Bob Iger Returns | Diet TBPN

This episode covers a range of tech and finance updates, with heavy focus on private equity struggles in software, OpenAI's latest model release amid distillation risks, and mixed corporate earnings alongside executive shifts.

Thoma Bravo's Medallia Wipeout

Thoma Bravo is nearing an agreement to hand over customer feedback software firm Medallia to its lenders, resulting in a $5.1 billion equity wipeout from its $6.4 billion acquisition in July 2021. Medallia, which went public in 2019 before being taken private, carries $3 billion in debt held by Blackstone, KKR, Apollo, and Antares Capital. Debt trades at 74-79 cents on the dollar, prioritizing it over equity in restructuring.

The struggles stem from execution issues like salespeople missing quotas, not just AI disruption—though AI startups backed by Sequoia are targeting Medallia's core function of collecting and analyzing customer/employee feedback. Post-acquisition, Thoma Bravo installed new leadership in early 2025 for a turnaround, but rising interest rates from the low-rate COVID era ballooned floating-rate debt payments without matching cash flow growth. Blackstone's private credit head noted underperformance due to operations, not AI. Hosts see this as a warning sign for leveraged software firms, echoing Jamie Dimon's concerns about "cockroaches" in the sector, amid competition from founder-led rivals and AI-nat