The whole take a company struggling and load it up with debt and or sell it’s assets to a different company the same person probably has an ownership interest in, harvest as much cash as you can while screwing creditors, employees and customers seems like a lot.
Housing too and groceries etc.
Can someone explain the good in the situation we’re in?
If private equity is not involved, that infers those items are run by the government.
As I deal with government entities, I can tell you it’s a shitshow. There are added levels of costs, not to mention that it takes much longer to get something done.
As for housing, there is section 8 housing. It is for lower income people. I only know about that surficially from real estate investing.
The classic Private Equity model is to buy/invest in a company, put just enough into it to make it enticing for someone else, and then sell it off in parts to make money. That model is starting to go away and some very big PE firms are buying small companies, investing in them, and then holding on to them as their profits increase and they grow stronger. I’m seeing a lot of that in A&D. It has started in earnest in the last 5 years and I don’t see it slowing much. It will be interesting to see where it goes.
To the article you posted, health care is a bad business to be profit centric, and it is a very profitable business in the US. I think the real players that are stopping universal health care are the powerful people making a lot of money on health care that do not want to change that model. A PE would go even further in that business model and that would obviously result in a bad outcome.
The whole take a company struggling and load it up with debt and or sell it’s assets to a different company the same person probably has an ownership interest in, harvest as much cash as you can while screwing creditors, employees and customers seems like a lot.
Housing too and groceries etc.
Can someone explain the good in the situation we’re in?
should not or typically are not I assume are 2 different things. I am in a segment of construction that has multiple trade unions involved. Dealing with these and the legacy costs associated (ie. underfunded pension liability etc) are a pretty significant barrier to PE in my experience.
Should not… kind of a don’t get me started on PE and the impact they can have on an industry…
I spent the first 7 years of my legal career largely servicing PE companies and their portfolio companies. It’s still a significant part of my practice.
PE is definitely a double-edged sword. They do bring capital, expertise and an exit market liquidity that can be hugely useful. They also are rapaciously focused on the profit motive, with a well-defined timeline to realize gains. Those things are sometimes/often in tension.
I am very uneasy about PE in healthcare. Both from professional experience, and fighting with the PE-owned nursing home where my father spent the last few years of his life.
Housing I’m more ambivalent about. I think PE had an important role to play in the recovery after 2008. I also think in the last few years, PE’s involvement is exacerbating an already difficult housing market for entry level buyers.
If private equity is not involved, that infers those items are run by the government.
As I deal with government entities, I can tell you it’s a shitshow. There are added levels of costs, not to mention that it takes much longer to get something done.
As for housing, there is section 8 housing. It is for lower income people. I only know about that surficially from real estate investing.
I’m not talking about private ownership of homes. I’m talking about mega corporations buying whole neighborhoods or available houses in a neighborhood to create a large controlling interest in rentals.
My friend was reviewing a final purchase contract on a home when the builder called to tell her it was off - a PE firm had decided to buy the entire neighborhood of 200 new build single family homes.
The classic Private Equity model is to buy/invest in a company, put just enough into it to make it enticing for someone else, and then sell it off in parts to make money. That model is starting to go away and some very big PE firms are buying small companies, investing in them, and then holding on to them as their profits increase and they grow stronger. I’m seeing a lot of that in A&D. It has started in earnest in the last 5 years and I don’t see it slowing much. It will be interesting to see where it goes.
I’ve seen a blurring of the lines between VC and PE approaches for close to a decade now. From what I see, some VC firms are taking fewer flyers on early stage companies, wanting to see actual product and revenue before investing. And conversely, some PE firms are pushing earlier into companies’ life cycles, wanting to get in earlier, and not necessarily chopping it up for parts but taking it public or selling it whole into the secondary market of other PE firms or strategic buyers.
If private equity is not involved, that infers those items are run by the government.
As I deal with government entities, I can tell you it’s a shitshow. There are added levels of costs, not to mention that it takes much longer to get something done.
As for housing, there is section 8 housing. It is for lower income people. I only know about that surficially from real estate investing.
I’m not talking about private ownership of homes. I’m talking about mega corporations buying whole neighborhoods or available houses in a neighborhood to create a large controlling interest in rentals.
My friend was reviewing a final purchase contract on a home when the builder called to tell her it was off - a PE firm had decided to buy the entire neighborhood of 200 new build single family homes.
Today I saw an article on NPR about the founder/ceo of Salesforce buying up a lot of Waimea in Hawaii, which reminded me of visiting Lanai, which is 98% owned by some other rich jerk. It’s super creepy when individuals (or corporations) buy up all or nearly all available resources. How much power do we actually have in our democracies if this is the case?
I have a nightmare scenario. That I am witnessing.
It seems that the majority of the dermatology practices in my city have been acquired by private equity.
The process works like this:
the Dermatologists sell their practices for big $$$$ to private equity. The Dermatologist then retires, or goes to work somewhere else, or goes to work doing something else. (Non-compete clause).
The “dermatology practices” hires special nurses with low professional standards and lawyers (to protect these nurses from having to comply with professional standards.).
The nurses get paid commissions for selling sawdust pills, expensive skin creams, cosmetic procedures and unnecessary semi- medical procedures.
The practice avoid offering medical advice and avoids screening for serious conditions.
(This might leave them open to malpractice lawsuits and standards of professionalism- as they would be practicing “medicine.”)
The result for consumers:
A) “Dermatology practices” advise you to buy expensive creams and sawdust pills
B) They hard sell you for beauty treatments.
C) They refuse to evaluate you for skin cancer, or even refer you a real Dermatologists.
D) The private equity firms have bought most of the dermatology practices in the area.
The wait list for the few remaining real Dermatologists is YEARS long.
People are dieing of cancer because they can’t get diagnosed and treated.
At the same time, people are paying big $$$ for unnecessary and ineffective treatments prescribed by “dermatology practices.”
They often believe they are receiving medical care.
Our city flipped on a dime from developing condos for sale to developing permanent rental apartments.
The switch was very sudden. I can’t think of a single major development that was approved recently or is currently being built that you can actually purchase a unit from. Also, the average size of a 1 bedroom in these rental units is under 400 sq ft.
The whole take a company struggling and load it up with debt and or sell it’s assets to a different company the same person probably has an ownership interest in, harvest as much cash as you can while screwing creditors, employees and customers seems like a lot.
Housing too and groceries etc.
Can someone explain the good in the situation we’re in?
Don’t doctors make a lot of money off sick/injured people? They seem to have nice houses and cars in my area.
The whole take a company struggling and load it up with debt and or sell it’s assets to a different company the same person probably has an ownership interest in, harvest as much cash as you can while screwing creditors, employees and customers seems like a lot.
Housing too and groceries etc.
Can someone explain the good in the situation we’re in?
Don’t doctors make a lot of money off sick/injured people? They seem to have nice houses and cars in my area.
I have a nightmare scenario. That I am witnessing.
It seems that the majority of the dermatology practices in my city have been acquired by private equity. …
People are dieing of cancer because they can’t get diagnosed and treated.
At the same time, people are paying big $$$ for unnecessary and ineffective treatments prescribed by “dermatology practices.”
They often believe they are receiving medical care.
I had a dermatologist tell me she was no longer going to be with the practice and then go on a major rant about how she didn’t go to school as long as she did to push overpriced lotion with a sales commission. The lobby had a looping video on fillers. Same office had done a fabulous job treating my dad’s skin cancer a few years earlier.
Sort of unrelated but my wife’s best friend is an NP in a small town in BC. NPs are replacing GPs in many settings in remote communities and helping to fill gaps where we struggle to attract doctors.
However, she decided to stop her practice and open a Botox clinic and she more or less doubled her earnings.
I’m in a very large subspecialty ophthalmology practice. We have been approached many times, from PE folks, wanting to acquire our practice. It can be hard to resist these offers. Yes, we as docs make very good money but some of the money these PE firms are throwing at private physician groups is life changing…I’m talking 7 figures with the first buyout and 8 figures with subsequent buyout (and stock sale). But, the ethics (to us) cannot allow us to be sold to PE. We have always felt confident in out evaluation and treatment of patients in an ethical and medically justified manner. PE says they care about making us a “better practice” but we know that means increasing profits and having an influence on our decision making. Bad thing is, PE buying up doc practices, and hospitals, is rampant and the patients are the ones who will likely suffer…along with a further staggering increase in healthcare expenditures.
I’m in a very large subspecialty ophthalmology practice. We have been approached many times, from PE folks, wanting to acquire our practice. It can be hard to resist these offers. Yes, we as docs make very good money but some of the money these PE firms are throwing at private physician groups is life changing…I’m talking 7 figures with the first buyout and 8 figures with subsequent buyout (and stock sale). But, the ethics (to us) cannot allow us to be sold to PE. We have always felt confident in out evaluation and treatment of patients in an ethical and medically justified manner. PE says they care about making us a “better practice” but we know that means increasing profits and having an influence on our decision making. Bad thing is, PE buying up doc practices, and hospitals, is rampant and the patients are the ones who will likely suffer…along with a further staggering increase in healthcare expenditures.
Thank you for caring!
Can it get more expensive? I think our family is shelling out $30k a year + and have not gotten past our deductible in 14 years. That’s a crap ton of money for three annual exams, twice a year skin cancer checks, an eye doctor exam and maybe someone has a minor ortho issue. No drugs. On top of that there’s no trust if we need it we’ll get good care. Or like my old boss we will die of something curable while fighting with insurance.
Not only do I pay about 3x what used to a few years ago at the dermatologist - I have to listen to videos of how I look like shit in the waiting room and need Botox or some other thing.