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I'm referring to the large investor firms that go around buying out companies not listed on the stock exchange to capture entire markets, milk it for all it's w
by 7thaccount 2y ago
I'm referring to the large investor firms that go around buying out companies not listed on the stock exchange to capture entire markets, milk it for all it's worth, and then dump the shriveled corpse. This is very rarely good for the end customers or the employees who get outsourced. The owner gets millions though and it allows the PE firm to sell an asset class to investors.
On the one hand, I don't think it's right to restrict the rights of the business owner. If they have a company with $20M in revenue and PE offers $60M to buy them out...fair game right? On the other hand, it takes perfectly profitable companies providing value, extracts that wealth from happy consumers of the product to people already wealthy and then leaves the consumer with a crappy, expensive, and barely supported product. If this happens just a few times...it sucks, but no big deal. Once it starts happening all over America, then we start running into systemic problems like not being fleeced every time you want to go to a concert. It's not like a competing firm can just pop up either in a lot of cases as there are huge barriers to entry. There is no recourse other than not ever seeing your favorite artist again.