5 ms·

> while people might like to make public noises about hating PE, they sure like to sell their companies to them. I suspect that there's not a lot of overlap be

> while people might like to make public noises about hating PE, they sure like to sell their companies to them. I suspect that there's not a lot of overlap between people who publicly fume about good companies being ruined by profit-hungry buyers, and people who start companies explicitly so they can flip them to profit-hungry buyers and ditch. Does anyone still start businesses with the intention of building and maintaining a really excellent product/service in the long term? Do any of them hold on to that ideal after a few years?

shiroiuma 3y ago
>Does anyone still start businesses with the intention of building and maintaining a really excellent product/service in the long term? Do any of them hold on to that ideal after a few years? Define "a few". You can't expect most company owners to want to continue running that company for decades on end; eventually, they want to do something else or retire. So at some point, they have to sell. Who's going to buy an existing company that's profitable? Someone who's "profit-hungry" usually. If the company is just a passion project, no one buys it and it just goes under when the owner gets tired of it.
- tacocataco 3y ago
  Depending on the size, the city/state could purchase the company and loan it to the employees. If the the loan gets paid off, boom... co-op equally owned by the workers.
  - lotsofpulp 3y ago
    Sounds like the perfect recipe for corruption.
  - WJW 3y ago
    And if the loan doesn't get paid off? That city/state is now in a huge hole, having spent money that could've been used to build schools and maintain roads on buying companies off their retiring owners. In any case I don't see why you would need the detour via local government? A bank could lend the money to the group of employees just fine.
- watwut 3y ago
  I know companies that exist for years and years and even get inherited. I even work in one. It exists, just not in SV
  - shiroiuma 3y ago
    Inheritance assumes that the founder's kids actually want to run their parent's company. Many times, they don't, so they sell. Running a company is a pain in the ass, so it's understandable many people don't want to be bothered.
    - watwut 3y ago
      If they sell it, it was still inherited. But I literally seen handover to younger family member to happen.
    - PhasmaFelis 3y ago
      There's a middle ground between giving a company to your kids and selling it to someone who you know will suck it dry for short-term gains. You can also give (or sell) it to someone that you know and trust to keep it sustainable.
      - shiroiuma 3y ago
        Who? Where do you find this person? Do you have any experience in running a business and selling businesses to others? And why do people assume that the kids are going to run it well or the same way the founder did? If anything, it seems like the kids of highly successful people are usually spoiled brats, and nothing like their parents. Did Bill Gates' kids create any successful software companies?
        PhasmaFelis 3y ago
        You seem to be trying to rebut several things I didn't say.
        3y ago
- PhasmaFelis 3y ago
  > You can't expect most company owners to want to continue running that company for decades on end That's not actually weird, though. The idea that everyone should be expected to change jobs every few years is very recent. > Who's going to buy an existing company that's profitable? Someone who's "profit-hungry" usually. I didn't think this needed specifying, but there's a large difference between the goals "Create a great, enduring service and make a profit doing it" and "generate as much short-term profit as possible regardless of long-term consequences."
stana 3y ago
As cheap money era seems to be ending, long term quality product/service might be the only viable strategy going forward.
- NoGravitas 3y ago
  Inshallah.
dewey 3y ago
It doesn't have to be the choice between "sell to profit-hungry buyer's and ditch" and keeping a company forever. Sometimes people just want to do something different with their time after running their business for a long time and a PE deal is the easiest and most structured way of doing that.
- PhasmaFelis 3y ago
  Sure. But (assuming you'd reached sustainable profitability, as BandCamp reportedly had) you can choose whether you sell to someone who intends to maintain what you've built, or someone who you know will suck it dry for short-term profits.

shiroiuma 3y ago

>Does anyone still start businesses with the intention of building and maintaining a really excellent product/service in the long term? Do any of them hold on to that ideal after a few years? Define "a few". You can't expect most company owners to want to continue running that company for decades on end; eventually, they want to do something else or retire. So at some point, they have to sell. Who's going to buy an existing company that's profitable? Someone who's "profit-hungry" usually. If the company is just a passion project, no one buys it and it just goes under when the owner gets tired of it.

tacocataco 3y ago
Depending on the size, the city/state could purchase the company and loan it to the employees. If the the loan gets paid off, boom... co-op equally owned by the workers.
- lotsofpulp 3y ago
  Sounds like the perfect recipe for corruption.
- WJW 3y ago
  And if the loan doesn't get paid off? That city/state is now in a huge hole, having spent money that could've been used to build schools and maintain roads on buying companies off their retiring owners. In any case I don't see why you would need the detour via local government? A bank could lend the money to the group of employees just fine.
watwut 3y ago
I know companies that exist for years and years and even get inherited. I even work in one. It exists, just not in SV
- shiroiuma 3y ago
  Inheritance assumes that the founder's kids actually want to run their parent's company. Many times, they don't, so they sell. Running a company is a pain in the ass, so it's understandable many people don't want to be bothered.
  - watwut 3y ago
    If they sell it, it was still inherited. But I literally seen handover to younger family member to happen.
  - PhasmaFelis 3y ago
    There's a middle ground between giving a company to your kids and selling it to someone who you know will suck it dry for short-term gains. You can also give (or sell) it to someone that you know and trust to keep it sustainable.
    - shiroiuma 3y ago
      Who? Where do you find this person? Do you have any experience in running a business and selling businesses to others? And why do people assume that the kids are going to run it well or the same way the founder did? If anything, it seems like the kids of highly successful people are usually spoiled brats, and nothing like their parents. Did Bill Gates' kids create any successful software companies?
      - PhasmaFelis 3y ago
        You seem to be trying to rebut several things I didn't say.
        3y ago
PhasmaFelis 3y ago
> You can't expect most company owners to want to continue running that company for decades on end That's not actually weird, though. The idea that everyone should be expected to change jobs every few years is very recent. > Who's going to buy an existing company that's profitable? Someone who's "profit-hungry" usually. I didn't think this needed specifying, but there's a large difference between the goals "Create a great, enduring service and make a profit doing it" and "generate as much short-term profit as possible regardless of long-term consequences."

stana 3y ago

As cheap money era seems to be ending, long term quality product/service might be the only viable strategy going forward.

NoGravitas 3y ago
Inshallah.

dewey 3y ago

It doesn't have to be the choice between "sell to profit-hungry buyer's and ditch" and keeping a company forever. Sometimes people just want to do something different with their time after running their business for a long time and a PE deal is the easiest and most structured way of doing that.

PhasmaFelis 3y ago
Sure. But (assuming you'd reached sustainable profitability, as BandCamp reportedly had) you can choose whether you sell to someone who intends to maintain what you've built, or someone who you know will suck it dry for short-term profits.