5 ms·

I think what we are really seeing is a private equity bubble propping up fundamentally unprofitable companies, and its deflating because so much time passes bet

• dehrmann 7y ago
  > private equity bubble It's institutional investors (think pensions) chasing returns because of low interest rates. PE's played a role in a lot of things we're currently seeing. I wouldn't characterize its role in tech quite as propping up a bubble. Easy money means companies are trying a winner-take-all approach, loss-making longer, and delaying IPOs. Tech IPO performance has been mostly lackluster because of a lack of profits and private investors already captured gains from most of the growth. Outside tech, they've been buying up medical companies, raising out-of-network rates, leading to surprise medical bills. They're also under fire for leveraged buyouts, but turning around distressed assets is what PE's historically been good at, and for all the noise about leveraged buyouts and store closures, these were already sinking ships. PE didn't kill Toys R Us, Amazon did.