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Dayforce's return to the private market will allow the Minneapolis-based HR software provider greater flexibility as it expands its AI offerings, CEO David Ossip tells Axios Pro.

Why it matters: In a competitive HR tech landscape, companies will have to move fast in AI to grow their market share.

Driving the news: Thoma Bravo said Thursday it will buy Dayforce for $12.3 billion, with the PE giant calling it the "largest standalone enterprise software deal ever led by a financial sponsor."

This interview has been lightly edited for length and clarity.

Can you talk about how the deal came about?

"Obviously there will be details in the proxy when it comes out, so I have to just be very careful. As you would probably expect, I know most of the players in the industry, so I regularly would have check-ins with everyone.

I've known Holden (Spaht, managing partner at Thoma Bravo) for a very long time. So there always was that continual dialogue. I've obviously respected them as an organization. They really are in a league of their own when it comes to enterprise software.'

What does Thoma Bravo buying Dayforce allow the company to do?

"Our belief is that there's a great opportunity for a new generational AI-powered human capital management company to emerge. But in order to do that, we have to move really quickly, and we need to focus our resources, our people, our innovation on what we need to do.

And it's a lot easier to get the needed space to do that in private. And so I think you'll see us be able to kind of accelerate all aspects of our business against that vision of becoming the generational software company in this age of AI."

Can you expand on why that's easier being private?

"What it gives me is it really allows me to accelerate communications with my employees. Whereas when you're a public company, you have to be very careful about how you communicate and what you communicate, and that slows you down.

The second thing is from a free cash flow perspective, we will exceed a billion dollars of free unlevered cash flow in the next few years. Now, in order to do that, it's not a linear function. I have to be able to be more nimble."

Are there emerging challenges in the HR tech sector with the weakening jobs market and influx of AI?

"We haven't seen that. If you look at the last earnings, we had sales for the first half of the year of up over 40% and we had a very strong Q4 as well.

Our market is frontline worker organizations, and those organizations are less likely to be impacted by AI.

When it comes to AI, we're quite fortunate because we have that single database, and data is very important in the space that we play.

Now we've been able to kind of leverage these foundational language models, which as you know are just getting smarter and smarter where we can allow you to go to our AI assistant and ask questions."

With Thoma Bravo as a sponsor, will Dayforce look to be more acquisitive?

"We've always been acquisitive. We've done a number of acquisitions over the last number of years. It helps us kind of innovate quicker each time we do that.

I do believe that in order to become the next generational company, M&A has to be part of it as it has been part of our journey today. And I do think the TB guys are experts in that."

Dayforce CEO on how going private will speed AI expansion

The acquisition by Thoma Bravo is one of largest in enterprise software for PE.

Photo illustration of David Ossop surrounded by abstract lines and squares. 

Photo illustration: Axios Visuals. Photo: Courtesy of Dayforce

Dayforce&#x27;s return to the private market will allow the Minneapolis-based HR software provider greater flexibility as it expands its AI offerings, CEO David Ossip tells Axios Pro.Why it matters: In a competitive HR tech landscape, companies will have to move fast in AI to grow their market share.

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Dayforce CEO on how going private will speed AI expansion

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