Francisco Partners has raised more than $18 billion across two new funds, making a direct bet that AI anxiety has pushed parts of the enterprise software market too far down.
The San Francisco-based buyout firm closed Francisco Partners VIII LP above its $14 billion target and Agility Fund IV LP above its $4 billion goal, giving it the largest fundraise in its 25-year history. The timing is the story. At a moment when many private equity firms are treating software with new caution, Francisco Partners has persuaded limited partners to give it record capital for technology deals.
That is not a small difference in posture. Bloomberg has reported that Apollo Global Management is screening new software investments for AI displacement risk, has little private equity exposure to software, and is steering more attention toward what it calls HALO assets, heavy asset, low obsolescence businesses. Rob Bittencourt's framework reportedly divides software into 12 to 14 categories based on how vulnerable they are to AI disruption. The message is clear enough: a lot of traditional enterprise software no longer gets the easy benefit of the doubt.
Francisco Partners is making the other side of that argument. Its pitch is not that AI risk is imaginary. It is that public market pressure, lower software multiples, and forced selling have created entry prices that have not been available in years. Jamf is the cleanest example. Francisco announced in October 2025 that it would take the Apple device management company private in a $2.2 billion deal, and the transaction closed in January 2026. Jamf had gone public in 2020 at a valuation around $4.6 billion, so Francisco was buying a known enterprise software name after the market had sharply reset its expectations.
That matters because the best private equity trades are rarely built on discovering something nobody else can see. More often, they come from paying a price that assumes too much damage. Jamf is not an obscure asset. It serves a specific corporate need, managing Apple devices inside businesses, schools, and public sector organizations. The question is whether that kind of system is truly about to be replaced by AI, or whether investors have marked down the whole software category too broadly.
The fact that Francisco exceeded both fund targets says something about how institutional capital is reading the moment. Pension funds, sovereign wealth funds, and endowments have seen software grow from a niche buyout category into one of the largest sources of private equity exposure. They also know that many firms paid 2021 prices for assets that now need to be refinanced, sold, or marked down. Yet they are still backing a technology specialist with fresh capital, which suggests the market is separating yesterday's overpayment problem from tomorrow's buying opportunity.
The software question is becoming more selective
The distinction Francisco Partners is drawing is between software that is genuinely impaired and software that is temporarily mispriced. AI may pressure valuations across the sector, but it will not affect every company in the same way. A narrow workflow tool with weak customer loyalty is in a very different position from a platform tied into security, compliance, identity management, billing, or device infrastructure. Switching costs still matter. So does customer trust. So does the boring reality that large organizations do not replace core systems quickly just because a new model looks impressive in a demo.
That does not make the trade easy. Francisco now has to prove that its underwriting can distinguish durable software from products that are about to lose pricing power. The firm's advantage is focus. Since its founding in 1999, Francisco Partners has operated as a technology specialist, which gives it a different starting point from firms trying to build AI risk frameworks after years of treating software as a default growth category. The market is effectively paying Francisco to know which assets are sticky and which ones are merely familiar.
Apollo's view is not as contradictory as it first appears. The firm is warning against undifferentiated software bought at peak multiples with old leverage assumptions, not necessarily against every software asset at every price. That is an important difference. Buying a business at 2021 valuations and defending it through AI disruption is one problem. Buying it after the public market has already compressed the multiple is another.
The next test is deployment. Francisco has raised a large amount of capital into a market where the best opportunities may be scattered across smaller, messier, and more complex transactions. That is where Agility Fund IV could matter. A dedicated vehicle for smaller technology deals gives the firm room to act below the scale of its flagship fund, especially if the AI reset creates more fragmented opportunities than giant take-private transactions.
The risk is obvious. If AI displacement moves faster than Francisco expects, the firm will have doubled down on a category while the ground was still shifting. But if the market has punished durable software along with weaker names, this fundraise could mark the beginning of one of the more interesting private equity vintages in years. Watch where Francisco deploys first. The firm's early deals will tell us whether this is a disciplined bet on mispricing, or simply a very large wager that software fear has gone too far.
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