Many PE owned software businesses are financed by private credit. Private credit has high concentration in software, 25–35%.

These companies report infrequently, so problems surface slowly.

It will be difficult for PE to exit many legacy SaaS platforms acquired at high multiples.

For private credit lenders the risk is not only higher defaults, but also lower recoveries. Software cos have few hard assets, and IP is not worth much when they are disrupted.