Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Private equity is buying everything from vet offices to tech conglomerates

theverge.com

Post reply on HN
Print view View original

311–320 of 362 posts

Re: Private equity is buying everything from vet offices to tech conglomerates

#311

Post by skywal_l »

anonporridge wrote: post #268
78124781 wrote: post #211

Earlier quoted context omitted.

The professor who wrote that book, interestingly, ended up being denied tenure and was subsequently unable to get another academic job despite years of trying. Here's a recent podcast with him: https://www.persuasion.community/p/deresiewicz It may not be the best thing in the world to be an "excellent sheep," but perhaps it's better than being a lone ram.

If you reject the shepherd, you have to be prepared for the brutal life of a mountain goat.

He was denied tenure before writing the book. So I guess if you refuse the shepherd dog, be prepared to face wild dog predation.

Re: Private equity is buying everything from vet offices to tech conglomerates

#312

Post by hknmtt »

I am getting into M&A, which is what PE do, and I don't even need to read the article to know it's bs.

In essence, the PE firm's goal is to consolidate multiple companies, make them work as efficiently as possible, by sharing resources and utilize the best processes, and then either operate them for increased profit or sell them off for good multiples of earnings, because they have added value to it, so someone else can run it from there on with less headache and no more need to put these efficiencies in place. There is nothing bad with any of this. In essence, it's about bringing efficiency into the market and getting paid for doing so.

Re: Private equity is buying everything from vet offices to tech conglomerates

#313

Post by sytelus »

I would high recommend the book The New Tycoons: Inside the Trillion Dollar Private Equity Industry That Owns Everything. The book was released 3 years ago and people are now waking up the devastations caused by the private equity firms everywhere.

The fuel of private equity firms is yours and mine 401K. That's trillion of dollars of money floating around. PE firms gets tons of cash as debt which gets sold to 401K fund managers. So, in essence, PE firms get money from you and me to destruct the local businesses we depend on. The entire story of making businesses capital efficient is bullcrap. PE firms lives to make short term profits and move on. They are not into business for its philosophy, values and long term customer loyalty. They want to cut the cost, make it look profitable and sold it to sucker to cash out.

Re: Private equity is buying everything from vet offices to tech conglomerates

#314

Post by atourgates »

taeric wrote: post #226
atourgates wrote: post #204

Earlier quoted context omitted.

It’s more complicated than that. TL;DR: To a larger degree than most businesses, the physician is the value in a medical practice. Let’s say you’re a dermatologist in Lincoln, Nebraska. You want to live there because of family reasons or whatever. You build a great thriving practice. You’re clearing $1m in profit annually. (A high, but doable number for a dermatologist with a good private practice) Now it’s time to r…

This is painting physicians as more unique than they are. Carpenters, artists in general, electricians, plumbers, etc. are all in roughly the same boat. A lot of trust built into a reputation that someone built. Now, sure, the modern world doesn't built up on reputations as much. But the general idea is the same. Such that, yeah, you may find you have nothing that you can sell without you in it, if that is what you b…

No, I would actually agree that those can be very similar situations from a “selling your business” standpoint, with the difference that while some of their professions have been particularly scarce for a few years, medical specialties have been scarce in many parts of the country for decades, and the pathway to become a medical specialist is highly capacity constrained, while the pathway to becoming a tradesperson is typically more demand (for people wanting to go into the profession) constrained.

Re: Private equity is buying everything from vet offices to tech conglomerates

#315

Post by bmalicoat »

hknmtt wrote: post #312

I am getting into M&A, which is what PE do, and I don't even need to read the article to know it's bs. In essence, the PE firm's goal is to consolidate multiple companies, make them work as efficiently as possible, by sharing resources and utilize the best processes, and then either operate them for increased profit or sell them off for good multiples of earnings, because they have added value to it, so someone else…

>> "There is nothing bad with any of this."

My experience has been that once a small business is snatched up by a firm, customer service goes out the window and the focus on efficiency leads to a marked decline in overall quality. I'm sure it's all gravy for the people making money though.

Re: Private equity is buying everything from vet offices to tech conglomerates

#316

Post by sytelus »

voiper1 wrote: post #310
sytelus wrote: post #309

I have seen this happen over and over. This is the issue that should be front and center for elections but public doesn't know what is going on. Recently PE firm bought out the building which had oldest and only rock climbing gym. PE firm refused to renew their lease and forced to shut it down. The entire community of rock climbers basically died overnight. Lots of children growing up and learning this sport would no…

While you've clearly explained how this is bad, how is this not a free market? >an economic system based on supply and demand with little or no government control

It is not the free market because they are privileged through their connections to acquire massive amount of cash in form of credit. The trillions of dollars available in funds from banks and retirement funds are managed by just handful of entities. You and me don't fly in our private jets to play golf with CEOs in Palm Beach. You and me don't have privileged access to these entities to get $10M loan in blink of an eye to buy up a local Rock Climbing gym and shut them down overnight. They CAN and they DO. They use their massive credit leverage through privileged connections to destruct any businesses they want, extract short term profits and move on. In many ways, few entities have monopolies over such credit leverage and that's absolutely not free market.

Re: Private equity is buying everything from vet offices to tech conglomerates

#317

Post by int0x2e »

dx034 wrote: post #306
JohnFen wrote: post #188

Earlier quoted context omitted.

> Prestige is a powerful motivator. I know this to be true because I've seen so many people given BS titles instead of raises and be happy about it as if they got something of real value. But I don't understand it at all. Apparently, I lack the "prestige" gene.

It's important though if you don't want to stay at the current company forever. With the right title it's much easier to get a well paying job. Otherwise you'll have to convince future employers why you didn't have that title despite your qualifications and work.

I call this "resume engineering". Some years ago, I decided to pass on a very impressive position at one of the then-hottest tech unicorns. I kinda liked the people, thought the tech was cool, but didn't see any way for the company to succeed.

As I thought, that company died, firing 100s of folks before the end.

It's been a few years, but a former colleague who took that job, managed to land an impressive title at my previous employer, above my level at the time... I have since left that company (unrelated), moved to a startup, and couldn't be happier.

My opinion is that titles don't matter. At all.

Compensation does matter, but you have to also value your happiness and factor that as well.

Re: Private equity is buying everything from vet offices to tech conglomerates

#318

Post by austin-cheney »

JumpCrisscross wrote: post #136

I have a pet theory: there are managerially-minded university graduates who value prestige more than power or pay. In the post-War era, they became beige-suited company men. In my generation, they went corporate finance. Today, they work for private equity. Banking was great. Everyone–from liberal arts to engineering majors–could putz around for years in a pre-defined and prestigious path with moderately above-market…

_________ was great. Everyone–from liberal arts to engineering majors–could putz around for years in a pre-defined and prestigious path with moderately above-market pay and the potential to become rich. (Most don't.) It was also a field that could absorb a lot of grunt work, because most of what these folks did was _________ templates.

AdLibs is fun. How about: Developing and React.

Re: Private equity is buying everything from vet offices to tech conglomerates

#319

Post by int0x2e »

rr808 wrote: post #277
TrackerFF wrote: post #183

Earlier quoted context omitted.

Yes, they are called "Insecure overachievers". They are the bread and butter of investment banks, management consulting firms, big law firms, etc. They are also the reason that partnerships still thrive. A couple of years ago I was talking with this (big law) partner at a dinner, and we came in on the topic around partnership - and he just said it straight: The competition / rat race towards partnership is 100% skewe…

> many would have made the same amount of money if they struck out on their own, opening a small boutique firm Surely this it the same in tech. Most employees of FAANG companies could do something in a small company but the big company is just more prestigious and less risky. Every small business is like this now, doctors offices, restaurants, stores are all chains.

FWIW, there's a study that looked at patent filings and paper publications for inventors in small vs. large companies.

It seems that as a whole, when people choose the Big-X route, they tend to make fewer inventions and publish fewer papers and their inventions and papers get cited less.

So, in theory, by going to work in Big-Tech, you're choosing greater comfort and prestige, while reducing your overall impact on the world, while the startup route holds much more expected impact, but a much higher likelihood of reduced financial comfort.

There's a part of me that thinks that nations that encourage hoarding talent would be less successful than those that encourage innovation, and therefore, I wonder if we need some sort of innovation grant (i.e.: for every successful patent application/company registration/etc. that is NOT fraudulent, the submitter gets 24 months of financial support at the median income level, so they can chase that dream)

Re: Private equity is buying everything from vet offices to tech conglomerates

#320

Post by rootsandstones »

singleshot_ wrote: post #287
manfre wrote: post #274

Earlier quoted context omitted.

> aggravating (e.g., self-checkout lanes... self-checkout lanes are not viewed as a bad thing by many. Given the option of a self checkout or staffed checked, I'd choose self checkout. The negative aspect of self-checkout is that it's usually paired with the store being understaffed, instead of redirecting the freed up staff to other roles.

Where am I supposed to put all the groceries? They have to stay on the scale, but the scale is very small.

Here In Switzerland self checkouts don‘t have scales, you just scan everything and pay.
Post reply on HN