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"Private equity backed companies are 10 times more likely to go bankrupt than public companies." - is this because they're running successful companies into the ground or because the kind of companies that get eaten up by PE are the ones that are failing anyway?
Is there a company out there that has survived a gutting by PE?
Yes. The specific equity firm that owns WP Engine has multiple notable successes, including Skype, GoDaddy, and Dell. ( https://en.wikipedia.org/wiki/Silver_Lake_(investment_firm) )
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Sure, but the blast radius still has to be considered. Working to reduce that is certainly a worthwhile endeavor even if the end state is the same.
Working to reduce what? The risk of wpengine over extending and going bankrupt? So we try and bankrupt them earlier? This makes no sense.
A single example is insufficient, especially when that example is Drupal. In a former life I evaluated WordPress, Drupal, and some other open source CMSs. Drupal seemed remarkably terrible. Maybe I just wasn't the target user...but UI, UX, and DX all seemed blighted and the ecosystem much less vibrant than WP's. Came away thinking it was a vestige of yesteryear, and not something in which to invest any time, energy,…
This is not really news. The question is, what there is to do? I think that it is logical to sell your company to highest bidder when you want to exit, and often the highest bidder ends up being a PE firm.
Be a founder that wants to build a long-term business that employs people that want to create a good product. Be an employee that will only work for companies founded by those people.
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I haven't been to the dentist in 4 years and I'm hell-bent on finding one that is not part of PE or any type of corporate ownership. I'm prepared to drive to rural areas or hours away because I will not trust that their incentives are aligned with mine.
Is there an easy way to discover whether or not a given business is owned by PE?
PE are vultures: vultures feed on dead animals, not healthy ones. You don't sell off a successful, thriving business to be gutted and restructured because you're going to make much more money keeping it going the same way. "Private equity backed companies are 10 times more likely to go bankrupt than public companies." - is this because they're running successful companies into the ground or because the kind of compan…
It would be good to explain the difference between PE funding and VC funding.