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I do understand what you’re saying, I just think it’s a problem that’s at least self-limiting. A million dollars is not a lot to start a business of that scale.

I do understand what you’re saying, I just think it’s a problem that’s at least self-limiting. A million dollars is not a lot to start a business of that scale. You can’t open a steakhouse in any mid-sized city for that much, and vet clinics actually make money. You don’t see PE firms buying up restaurants. If PE firms are buying them the ROI is clearly very good. If vets are really fretting, I’m sure a bunch of highly educated, high salary people in a very lucrative field can drum up a million bucks.

mattmaroon 2y ago
Also, he bought an existing clinic which, if already successful, has business value. It generally costs more to buy a successful business than to start one, though that’s not an ironclad law.
1propionyl 2y ago
> You don’t see PE firms buying up restaurants. c.f. the 2-5 "restaurant groups" in every midsized city with a portfolio of "concepts" who open up a new one just as the one from last year starts to get stale and lose momentum. The ones that always seem to have absolutely exorbitant interior design budgets. Where exactly do you think their funding is coming from?
- mattmaroon 2y ago
  I work in the food industry now. The answer believe it or not is usually private investors who really love food and think it would be really cool to own a restaurant. You can easily start a small restaurant with what is a small investment to a few wealthy people. 1 million or two just ain’t much these days. That’s actually why it is an unprofitable business, the people who do it aren’t really doing it for money. Supply outstrips demand which pushes prices down.
infecto 2y ago
I struggle with this same line of thought. I get it, there are sometimes bad outcomes with PE but same goes for any business. If this is so lucrative that PE is rolling up businesses, surely there are margins to be made starting up your own practice.
nitwit005 2y ago
> You don’t see PE firms buying up restaurants. They do, just usually restaurant chains.
ceejayoz 2y ago
> You don’t see PE firms buying up restaurants. Huh? The chain restaurant space is chock full of this. https://www.cnn.com/2023/08/24/investing/subway-sale-roark/index.html https://www.cnn.com/2023/08/24/investing/subway-sale-roark/i... " Roark holds investments in a number of large restaurant chains, including Arby’s, Auntie Anne’s, Buffalo Wild Wings, Carvel and Sonic, among others." "Roark’s deal is one of the biggest acquisitions in fast food history, coming in just under Inspire Brands’ $11.3 billion purchase of Dunkin’ in October 2020. Roark owns Inspire, which also operates Subway rival Jimmy John’s." Subway alone is twenty thousand restaurants.

mattmaroon 2y ago

Also, he bought an existing clinic which, if already successful, has business value. It generally costs more to buy a successful business than to start one, though that’s not an ironclad law.

1propionyl 2y ago

> You don’t see PE firms buying up restaurants. c.f. the 2-5 "restaurant groups" in every midsized city with a portfolio of "concepts" who open up a new one just as the one from last year starts to get stale and lose momentum. The ones that always seem to have absolutely exorbitant interior design budgets. Where exactly do you think their funding is coming from?

mattmaroon 2y ago
I work in the food industry now. The answer believe it or not is usually private investors who really love food and think it would be really cool to own a restaurant. You can easily start a small restaurant with what is a small investment to a few wealthy people. 1 million or two just ain’t much these days. That’s actually why it is an unprofitable business, the people who do it aren’t really doing it for money. Supply outstrips demand which pushes prices down.

infecto 2y ago

I struggle with this same line of thought. I get it, there are sometimes bad outcomes with PE but same goes for any business. If this is so lucrative that PE is rolling up businesses, surely there are margins to be made starting up your own practice.

nitwit005 2y ago

> You don’t see PE firms buying up restaurants. They do, just usually restaurant chains.

ceejayoz 2y ago

> You don’t see PE firms buying up restaurants. Huh? The chain restaurant space is chock full of this. https://www.cnn.com/2023/08/24/investing/subway-sale-roark/index.html https://www.cnn.com/2023/08/24/investing/subway-sale-roark/i... " Roark holds investments in a number of large restaurant chains, including Arby’s, Auntie Anne’s, Buffalo Wild Wings, Carvel and Sonic, among others." "Roark’s deal is one of the biggest acquisitions in fast food history, coming in just under Inspire Brands’ $11.3 billion purchase of Dunkin’ in October 2020. Roark owns Inspire, which also operates Subway rival Jimmy John’s." Subway alone is twenty thousand restaurants.