Thoma Bravo co-founder Orlando Bravo on Wednesday said software stocks are "oversold" and the sector is being pulled down by a lack of profits.
"Most of these 300 publicly traded software companies, they don't have enough profits," he told CNBC's "Money Movers." "They trade as a multiple of revenue, and that's very, very dangerous."
Thoma Bravo, a software-focused investment firm founded in 2008, had over $181 billion in assets under management as of September.
Bravo said that as artificial intelligence poses a threat to software companies on a technical basis, domain experience becomes more valuable.
"There's some jewels in the public markets right now that are worth so much, that have 30 years of domain expertise built into their product," Bravo said. "And those companies are really, really cheap right now. We're very active in looking at a lot of them."