Quote:
Originally Posted by thinkxingu
Are there any examples of a business going corporate that have worked out positively for the consumer?
I think about this a lot, actually, as I was part of the Tweeter explosion...and downfall, and two of the central causes of its demise were bringing in "big box" retailer "specialists" to run what was never supposed to be a big box business and going public/being beholden to profit-driven shareholders over what was best for the company AND its customers.
*There's a book called The Common Good by Robert Reich that I find very interesting. In it, he points to where he thinks the shift occurred from "stakeholder" capitalism, where employees, ownership, AND customers find the perfect balance to "shareholder" capitalism, where the focus is on maximizing profit.
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PE has two faces:
When the investors are investing in the business for growth, it works out well for all if the business is successful--tech, biotech, pretty much all the high growth companies in the US had PE investors at some point (I include venture capital as a subset of PE). This is the American Way
But when PE invests in low growth mature businesses, such as mom & pop marinas, they are typically looking to squeeze maximum profit rather than boost growth. And even if they do figure out a way to grow, the lake is a finite resource, so....Reich, or at least his friends, would call this extraction capitalism. Not really good for anyone but the PE guys
