“In venture deals, if you're in the right thing, it almost doesn't matter what you paid.”
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch · Startups & Venture · August 2026
O'Driscoll was picking apart the Silverlake bid for Workday as a leveraged buyout, where the whole return depends on precise entry pricing and a modest overpayment drops it from acceptable to regrettable. He set that against his own business, where being in the right company swamps what you paid to get in. He named Cursor and OpenRouter as the cases that make the point, and called the buyout the exact opposite kind of bet.
Transcript
…play. So Salesforce is about it, right? But if you step back from it, I'd rather have someone from Wiz that is close to technology, that is in a hyper-competitive space rather than asking how many seats of Slack you want. It's just a very different go-to-market motion, right? It's very different.
…circles a $43 billion take-private bid for Workday, one of the biggest SaaS buyouts ever. We've got two of the best SaaS minds in the business here. Guys, what should we take from this? SaaS isn't dead. One of the biggest firms, one of the biggest buyouts. The stock popped 18% afterwards. Wow.
…You pay down the debt and the interest. And, you know, provided you buy right, you can make 20% and almost a 2x over four or five years. I look at that deal and I go, I'm torn. Because first of all, I think Silverlake are wildly smart. It's very interesting when you run the sensitivities. If you pay like 20% too much, it dips down into the mid-teens. It's almost the exact opposite of venture. In venture deals, if you're in the right thing, it almost doesn't matter what you paid. You see cursor for details, see open router for details, right? This is the exact opposite. This is fine, precise financial engineering. If you're wrong by 20%, 30% on price, you know, your IRR dips from 20, which is totally acceptable at scale, to low teens, in which case you wish you hadn't done the deal.
Can I ask a question? Precise financial engineering for a four to six year hold period. Six years ago, ChatGPT didn't exist. Are you able to do fine, precise financial engineering in a world where we move so fast?
I don't think system of record is, I think it's a moat, but I don't think it's a ticket to growth. This is, I think, super important. And it's something that everyone on X gets wrong. It's great to have a system of record, which Workday has, even with AI and LM's help. It's very hard to churn or…
But it wouldn't be in the damn base case. Jason, you framed the base case exactly correctly. It's 5.3 times 200. In other words, what this says is financial minds will pay five times revenues for system of record growing at 13%. Anything that's not a system of record, anything that's not going as…
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