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

Private equity bought America's essential services

rubbishtalk.com

Post reply on HN
Print view View original

81–90 of 584 posts

Re: Private equity bought America's essential services

#81

Post by palmotea »

amazingamazing wrote: post #44
dd36 wrote: post #2

End consolidation. Go back to pre-1980s antitrust policy. Encourage competition and bust the trusts.

How will that work - for example Y Combinator classes. They cannot be acquired? What about acquihires? Cant stop that - employees have their own agency.

> How will that work - for example Y Combinator classes. They cannot be acquired?

For the record: national economic policy shouldn't revolve around Y Combinator classes and similar startups.

I'm totally fine if it turns out a sensible antitrust policy completely destroys the acquisition exit pathway for tech startups. I'm not saying one will, but I'm saying that's a cost I'm willing to pay.

Re: Private equity bought America's essential services

#82

Post by estearum »

amazingamazing wrote: post #63
toomuchtodo wrote: post #59

Earlier quoted context omitted.

If the acquirer attempts to acquire a startup (regardless of investor) for anti trust reasons, or there are anti trust concerns, the M&A activity is disallowed by regulators. A recent example is Figma and Adobe. https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que...

Seems vague. What is an anti trust reason? Figma and Adobe id a great example. Both are doing very poorly.

It's not vague. You can go look it up.

Re: Private equity bought America's essential services

#83

Post by c16 »

fredley wrote: post #13

The people behind these funds are playing Monopoly IRL, and this in particular makes me very angry. The UK high street has been a notable victim. Gradually, over the past couple of decades, company after company has been snapped up by PE. Not just shops, but restaurants too. Suddenly you realise that the 5 or 6 high street chains that were competing are now owned by the same fund. Quality collapses, prices rise, not…

As a consumer, there are many non PE owned restaurants and pubs you can frequent. While you might not be able to change the game, you can absolutely vote with your wallet. The small guys will thank you.

Same for Amazon vs going direct to the manufacturers, which is more often than not, China.

Re: Private equity bought America's essential services

#84

Post by estearum »

amazingamazing wrote: post #74
toomuchtodo wrote: post #70

Earlier quoted context omitted.

> Given the vagueness it is no surprise nothing happens. Lots of success during the last admin for those paying attention. https://www.ftc.gov/news-events/news/press-releases/2025/01/... https://www.economicliberties.us/press-release/lina-khans-tr... https://www.economicliberties.us/our-work/factsheet-the-ftc-...

Most of these are not blocking merges or sales. What is your point? We are talking about the original comment which advocates ending consolidations.

Quite clearly the word "consolidation" is referring not to acquisitions, but to M&A activity that achieves a certain level of, you know, consolidation.

Re: Private equity bought America's essential services

#85

Post by jjmerle »

Interesting seeing a quote from Sen. Josh Hawley that I agree with...

Quote (from article) “This didn’t just happen to you accidentally. This is a business decision, isn’t it? You keep these backlogs like this. […] Another word for this would be a heist. This sounds to me like private equity came in; bought up all of these small companies; combined them; shut down their production; rolled up a huge backlog; massive profits; stiffed these guys; and now you’re making out like bandits.”

Re: Private equity bought America's essential services

#86

Post by amazingamazing »

palmotea wrote: post #81
amazingamazing wrote: post #44

Earlier quoted context omitted.

How will that work - for example Y Combinator classes. They cannot be acquired? What about acquihires? Cant stop that - employees have their own agency.

> How will that work - for example Y Combinator classes. They cannot be acquired? For the record: national economic policy shouldn't revolve around Y Combinator classes and similar startups. I'm totally fine if it turns out a sensible antitrust policy completely destroys the acquisition exit pathway for tech startups. I'm not saying one will, but I'm saying that's a cost I'm willing to pay.

YComb was just an example, though. Should companies be able to be bought and sold at all? My opinion is yes. Agree or disagree?

Re: Private equity bought America's essential services

#87

Post by ebiester »

energy123 wrote: post #18
kokken wrote: post #9

Earlier quoted context omitted.

It is not analogous because if you sell your house and the sale money is not enough to cover your mortgage you are still on the hook for what's left of the principal. A leveraged buyout is exclusively on the purchased company's books, so if the company goes to zero the PE parent company is not on the hook for a single penny.

> so if the company goes to zero the PE parent company is not on the hook for a single penny. Sounds like a problem for whoever is providing the financing. Not really my concern unless you're saying there's some systemic problem it causes like with mortgage securitization during 2007. The lender will charge a high interest rate if what you're saying is true.

It's the concern for the community who pays in higher prices, and the employees in their job stability.

Has everyone forgotten the social contract? We do not exist as communities to make a small number of people richer. If the trade doesn't work for all involved, we change the rules.

Re: Private equity bought America's essential services

#88

Post by elevation »

philipwhiuk wrote: post #60

Leveraged buyout should be illegal.

How would you phrase this though? Plenty of PE firms have the funds to buy your local veterinary clinic or auto body shop with cash; the leverage comes later, when they direct the business that they own to get a loan. How can you make it illegal for the business to get a loan?

Re: Private equity bought America's essential services

#89

Post by asolove »

amazingamazing wrote: post #86
palmotea wrote: post #81

Earlier quoted context omitted.

> How will that work - for example Y Combinator classes. They cannot be acquired? For the record: national economic policy shouldn't revolve around Y Combinator classes and similar startups. I'm totally fine if it turns out a sensible antitrust policy completely destroys the acquisition exit pathway for tech startups. I'm not saying one will, but I'm saying that's a cost I'm willing to pay.

YComb was just an example, though. Should companies be able to be bought and sold at all? My opinion is yes. Agree or disagree?

The OP explicitly answers this: go back to pre-80s antitrust policy. Companies can be bought and sold but not if it creates concentrations of economic power that allow them to dictate prices to vendors or customers.

Re: Private equity bought America's essential services

#90

Post by a4isms »

DangitBobby wrote: post #56
amazingamazing wrote: post #21

Seems strange to me: 1. No one forced these people to sell. Is the idea that you can’t sell to an entity with more money? If you block that good luck with the world economy. 2. If above is ok is the idea that the new owner is inherently worse because they have more money, whereas as the smaller would be OK then where are the new entrants? 3. Going to the article it is clear enough. These industries just are not lucra…

If you own a business and wish to retire, your options are pretty much to sell, pass it on to someone, or dismantle it. I don't know how this is even a question really. Where in the article or the comment section is anyone saying they shouldn't be selling?

Two connected anecdotes:

1. In the 90s, I had a struggling one-man Mac ISV, and would do gig programming on the side. I did a lot of work for boutique investment banks, and also for a "consulting" firm that did about 75% of their business with the finance industry. The owner of that firm praised me, but didn't like that if my business took off, he'd lose me.

"What would it take to get your commitment to this firm?"

50%

"Where will you get the money to buy half my company?"

A loan from the firm?

When the dust cleared, the business loaned me the money to buy in, and I paid it back with 50% of my profit sharing payouts. This is not some weird financial alchemy, a lot of partnerships are run this way.

———

2. My Duathlon racing buddy was a mold-maker, very specialized and good at his trade. He worked for an elderly entrepreneur who had built his mold business up over decades. Said entrepreneur sent his own kids to university to become "professionals."

What to do about succession when he was ready to retire? My buddy literally photocopied my own arrangement, bought 50% so the business would have a successor it could count on, and bought the remainder when the founder retired. He is now a comfortably wealthy automotive sector entrepreneur.

———

The huge LBOs in the news always seem like space-age deals, but little LBOs for succession purposes are remarkably common.

Post reply on HN