Private equity is buying everything from vet offices to tech conglomerates
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Re: Private equity is buying everything from vet offices to tech conglomerates
#2[deleted]
Re: Private equity is buying everything from vet offices to tech conglomerates
#3If you want to understand what went wrong with America, start with private equity
Re: Private equity is buying everything from vet offices to tech conglomerates
#4If you want to understand what went wrong with America, start with private equity
Lobbying/Bribery seems more egregious than investing.
At least investing has some economic forces that cause people to conserve resources and allocate them better than prior.
Lobbying/Bribery is just pure corruption. The medical industry is so extravagant because they are among the top lobbyists of all time. Only the entirety of real estate or all US businesses(chamber of commerce) can even compete with merely the American Medical Association or AHA. Heck, combining all of medical and the lobbying is worse than every other industry including all US businesses
https://www.opensecrets.org/federal-lobbying/top-spenders?cy...
Re: Private equity is buying everything from vet offices to tech conglomerates
#5I have firsthand experience of how PE ruins startups. We were a small startup and unfortunately our founder decided to go with a PE firm rather than a VC firm for a round of funding. The latter were upfront about job cuts but the PE firm did not say anything until them took over. The founder got a good paycheck but we were left holding the bag.
There was a bloodbath and they ruined the culture, the product and the morale. I never realized the meaning of a "cutthroat" culture until that time. It was personally the most stressful period of my employment.
From then on, the moment that I see PE mentioned anywhere, I know its time to run.
Re: Private equity is buying everything from vet offices to tech conglomerates
#6I don't know the answer here, so Im asking hoping that someone may. Couldn't private equity be seen as the "ants" of the economic landscape? Scraping the skeleton companies of the world for the last bits of meat on the bone and then move on to the next?
Re: Private equity is buying everything from vet offices to tech conglomerates
#7It's a shame what's happened to my local HVAC contractor. It used to be a great local operation where a real person picked up when you called. But lately, after a private equity group took over, it's all automated calls and foreign call centers. The personal touch is gone and, sadly, their service quality has taken a noticeable hit. It's just not the same anymore.
Re: Private equity is buying everything from vet offices to tech conglomerates
#8If you want to understand what went wrong with America, start with private equity
I mostly agree with this. I would say a lot of what is wrong with America is that corporation laws allow this kind of thing. There are other ways. Nobody thinks Germany is an economic backwater and they require, I believe in large companies, for employees to have a role in the management of the company [1]. There are also co-ops like the Mondragon Coop in Spain[2]. Some states have co-op laws but are mostly used by farmers and a few other niche things.
Interesting, most professional firms must be managed by their professionals, so law firms are partially "worker owned" too.
But I think the German model is probably the best. Equity interests and employee interests can both be short-term, but usually the best way to balance them is with long-term thinking.
I'm not sure that would save the world, but I think it would improve the lives of working people.
[1] https://en.wikipedia.org/wiki/Codetermination_in_Germany [2] https://en.wikipedia.org/wiki/Mondragon_Corporation
Re: Private equity is buying everything from vet offices to tech conglomerates
#9> When KKR buys Toys“R”Us or when Carlyle buys the nursing home chain ManorCare, the debt is held by the company that they bought
That right there is what should be made illegal. Somehow. There's probably all sorts of technicalities wherein KKR didn't buy it directly, but as the majority of the board of TRU, authorized the self-purchase or something like that. But you shouldn't be able to force a company to essentially buy itself, pay you a lot of fees to do so, then fuck off while it drowns in the debt you forced on it.
If you have authority over something, you are also responsible for it. Both the good and the bad.
Re: Private equity is buying everything from vet offices to tech conglomerates
#10If you want to understand what went wrong with America, start with private equity
I mostly agree with this. I would say a lot of what is wrong with America is that corporation laws allow this kind of thing. There are other ways. Nobody thinks Germany is an economic backwater and they require, I believe in large companies, for employees to have a role in the management of the company [1]. There are also co-ops like the Mondragon Coop in Spain[2]. Some states have co-op laws but are mostly used by f…
What I know about PE firms in Europe, they mostly operate the same way as in the US. There are plenty of PE firms and in general to me it feels like they are more popular here than US actually, as with LP's they are perceived as lower risk.
What I don't understand from the article, is how the PE firm is able to shift the debt from the buyer to the firm. That shouldn't be possible in any jurisdiction I know a little bit of, and I highly doubt that it is easy to do in US.