The Medallia Writedown
Thoma Bravo acquired customer experience platform Medallia for $6.4 billion in 2021. Three years later, the firm wrote down the entire equity stake, $5.1 billion, and handed the company to creditors. Pre-acquisition ARR sat around $400-500 million. The math did not work.
This is not an isolated event. It signals a broader repricing of enterprise software that is not AI-first. The PE playbook that worked for a decade, buy SaaS, optimise operations, multiple arbitrage, is breaking when the underlying asset loses terminal value.
Why This Matters for Sales Teams
Medallia competed in customer experience management against Qualtrics and others. The category relies on humans configuring dashboards, analysing feedback, and actioning insights. AI agents do not need that workflow. They pull data, run analysis, and execute without touching a UI.
That is the new framework for B2B software:
Bucket 1: Eroding terminal value. Agents do not use it. Medallia landed here.
Bucket 2: System of record. Enterprises keep it, but no agentic activity. Workday, potentially Atlassian. Fair valuations, no premium.
Bucket 3: Agent-leveraged. Agents actively use the platform. ServiceNow is fighting to stay here. Twilio and Cloudflare qualify.
If you are selling enterprise software, the question is not whether humans like your product. It is whether agents will use it.
The OpenAI Shift
Claude won 2024 because developers preferred it for coding workflows. That advantage may not transfer to agents. Early signals show AI agents prefer OpenAI's API for cost, speed, and workflow integration. Humans are becoming bystanders to procurement decisions.
For sales teams at SaaS companies: if your product requires human configuration, dashboard logins, or manual workflow management, your market is being repriced. The 30x revenue multiples are not coming back. Fair value for non-AI-first SaaS means lower growth assumptions and compressed valuations.
Medallia's writedown is the canary. The rest of the coal mine is being evaluated right now.