VistaOne, L.P.

VistaOne states incumbent software providers are positioned to capture value of agentic AI.

“First-quarter earnings, reported through May, offered evidence that the software sector’s AI transition is beginning to produce tangible results. Case studies emerged of companies that demonstrated AI-driven revenue and capabilities were rewarded by the market — re-rating higher and outpacing both the broader software sector and equity markets more broadly. Even so, volatility in public software markets continues to reflect a period of transition for the sector, and management believes enterprise adoption of AI will play out over an extended cycle rather than resolve in the near term. Management believes incumbent enterprise software providers remain well positioned to capture the value of agentic AI.”

Market uncertainty from advances in generative and agentic AI.

“Market sentiment during the quarter was influenced by broader macro uncertainties, including the Middle Eastern conflict, ongoing challenging sentiment in the public software sector and uncertainty related to the impact of advances in generative and agentic artificial intelligence (“AI”), as well as impact from private credit concerns. Amid the economic backdrop, U.S. equity markets reversed prior quarters’ positive sentiment, with the S&P 500 delivering a (4.3)% total return, while the S&P Software & Services Index declined 23.9% for the quarter. Credit markets, particularly the private credit market, volatility during the quarter reflected broad concerns pertaining to software, dispersion across subsectors and business quality. Despite this volatility, capital availability remains accessible for companies with strong fundamentals.”

Management believes incumbent enterprise software providers are positioned to capture value of agentic AI.

“Current volatility in public software markets is reflective of a period of transition for the sector as enterprises adopt AI. Management views this dislocation as being driven by sentiment and uncertainty and that changes in the underlying operating fundamentals of the sector are evolving. Investors have not yet seen the key performance metrics necessary to quantify the benefits of agentic AI. Management believes incumbent enterprise software providers are uniquely positioned to capture the value of agentic AI, given their ability to contextualize data and workflows, their ability to deliver deterministic outcomes and the current scale of these incumbents within an enterprise. In the latter half of the quarter, and subsequent to quarter end, software stocks experienced a recovery following a stronger earnings season and AI innovation. With more than 95% of software companies remaining private, public market movements may be an imperfect proxy for the broader enterprise software ecosystem.”

Vista is building AI capabilities and notes risks from AI including autonomous agentic AI.

“Ongoing technological advances in artificial intelligence (“AI”), and machine learning technologies, including autonomous agentic AI and generative AI based on large language models (including, for example, those developed by OpenAI and Anthropic) (collectively, “AI Technologies”) have the potential to create opportunities for Vista, its funds, investment vehicles and accounts and portfolio companies, as well as material risks. Vista is beginning to build AI capabilities into its business, operations and offerings, and Vista expects its usage of AI to continue to grow. As with many disruptive innovations, AI presents risks, challenges and unintended consequences that could affect its accuracy and adoption and therefore Vista’s business. While Vista intends the use of any AI to make processes more efficient and has implemented certain policies and procedures designed to help ensure that its use of AI Technologies is lawful and appropriate, AI models may not achieve sufficient levels of accuracy to achieve the desired results and the use of AI Technologies presents a number of risks that cannot be fully mitigated. AI algorithms may be flawed and the datasets on which such algorithms are trained may be insufficient, raise privacy concerns or contain biased information, which could undermine the decisions, predictions or analysis that AI applications produce, subjecting Vista to competitive harm, legal liability, regulatory action and/or brand or reputational harm. Some AI scenar”

AI technologies including agentic solutions may replace services and adversely affect Vista's business.

“The Fund’s Investments are concentrated in the software sector. Concentration in a single sector may involve risks greater than those generally associated with diversified investment funds, including significant fluctuations in returns. Software companies serve virtually every vertical market. The vertical market focus of such companies is a core reason for their stability and longevity, as these businesses offer their customers unique, industry specific capabilities typically not available from general purpose software vendors or new technology startups. The software sector is, however, challenged by various factors, including rapidly changing market conditions and/or participants, including due to the proliferation of AI Technologies and the resultant ongoing uncertainties that such developments could have on the software sector as a whole, new competing products, changing consumer preferences, short product life cycles, services and/or improvements in existing products. The software sector as a whole is highly cyclical. Furthermore, as AI Technologies evolve, it is expected that some services Vista, the Fund and their respective Portfolio Companies currently perform(s) for their clients will be replaced, in whole or in part, by AI Technologies, including generative artificial intelligence and agentic solutions, or other forms of automation, which could have a material adverse effect on Vista’s, the Fund’s and/or their respective Portfolio Companies’ business, results of op”

Software stocks declined due to reassessment of growth from advances in generative and agentic AI.

“At the beginning of 2026, software stocks declined as investors reassessed the potential business growth of the sector in light of rapid advances in generative and agentic AI. Current volatility in public software markets is reflective of a period of transition for the sector as enterprises adopt AI.”

Investors are digesting benefits that agentic AI can have on enterprise software companies.

“Management views this dislocation as being driven by sentiment and uncertainty and that changes in the underlying operating fundamentals continue to remain strong. Investors are still digesting the benefits agentic AI can have on enterprise software companies. With more than 95% of software companies remaining private, public market movements may be an imperfect proxy for the broader enterprise software ecosystem.”

Agentic AI application is positively impacting select software company valuations.

“With one U.S. Federal Reserve rate cut in September, capital markets activity for the third quarter continued its momentum, with September 2025 marking the busiest month for initial public offerings (“IPO”) since November 2021, raising over $8 billion with 13 IPOs in the U.S. While market conditions have been supportive of ongoing investor engagement, macro and geopolitical events along with robust valuations within the AI ecosystem continue to generate ongoing uncertainty for investors. Software companies continue to trade in line with historic levels, although the application of Generative AI and Agentic AI is starting to positively impact select company valuations.”