Blue Owl Says It Will Be More Selective Making Software Loans

Blue Owl Capital Inc. will be more cautious lending to software companies and has begun to reduce its exposure to the sector, executives told investors in two of its private credit funds.

“While software remains a primary focus, our underwriting threshold for new investments has never been higher,” Erik Bissonnette, president of Blue Owl Technology Finance Corp. (ticker OTF), one of the firm’s two publicly traded business development companies, said on its first quarter earnings call. The fund has become “increasingly selective,” he added, “continuing to pass on legacy models that may have been investable years ago.”