Thread

1. NegativeK · 1789944184 · focus · HN ↗

   Can someone steelman private equity, please? I'm honestly looking for the upsides (for non-investors) of when PE moves into an industry like medicine and begins buying up businesses that traditionally aren't already large chains.

   I already hear the downsides frequently from someone whose work is directly affected.

   1. tbrownaw · 1789950347 · focus · HN ↗

      > Can someone steelman private equity, please?

      Step back and look at what it fundamentally is.

      Person A has a business they want to sell.

      Person B has a pile of money and thinks that that business is (or can be) a good investment.

      That's it.

      So, what happens if person A is prohibited from selling their business? Are they forced to keep working because they don't have enough other savings to retire on? Do they shut the business down in order to retire? Something else?

      .

      Calls to ban private equity are attempts to play "shoot the messenger".

      1. __MatrixMan__ · 1789961776 · focus · HN ↗

         The business itself need not be a sellable thing.

         Sell the assets maybe, potentially to somebody who wants to use them to run the same kind of business in the same kind of location with the same employees.

         It's hostile to the consumer to call it the same business. A name change gives them the opportunity to decide for themselves whether the new owner is worth supporting. It's similarly hostile to the employees to assume that their loyalties can be bought and sold. Let the new owner of the assets re-hire them for the same position in the same location if he wants to, but lets not have them be for sale.

         1. 1123581321 · 1789962430 · focus · HN ↗

            I think that last point is opposite; it’s seen as heartless when the new owner of a business goes through rehiring existing employees instead of assuring them they still have a job.

            1. __MatrixMan__ · 1789965199 · focus · HN ↗

               Isn't offering them a job that's equivalent to their old one indistinguishable from assuring them that they still have a job? No need to make people reinterview, but at least give them the option to turn down the offer.

               Maybe I'm making too big of a deal out of semantics, but every time somebody buys me it makes me angry.

               1. 1123581321 · 1790017458 · focus · HN ↗

                  I don't think it's equivalent because it's paperwork they now have to think about, they're wondering if it's wiping away old employment promises or systems, did everyone get one of these offers, etc.

                  Definitely see how some would prefer the job reconsidered, though. There's no system that makes everyone happy, including to never sell a business.

                  These things are good to think about; appreciate it.

         2. solidsnack9000 · 1790100718 · focus · HN ↗

            The business itself need not be a sellable thing.

            Well, that is actually a wild thing to say. How could it not be a sellable thing?

            The people who presently own the business have a property interest in it -- that's fundamental.

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