I've probably done more venture capital deals and expansion financings than I have done private equity deals. But both are the same. Private equity companies have also built jobs.
Sentiment: POSITIVE
Private equity does pay very well, and my counterparts, guys that I grew up with who are still working at a number of firms, all make a lot of money.
People used to think that private equity was basically just a compensation scheme, but it is much more about making companies more efficient.
We really wake up every day trying to build businesses. That is the goal of private equity. It's a misnomer out there that private equity profits by shrinking companies. In fact, it's just the opposite. Private equity creates value by growing great companies.
People in private equity complain that they have so much capital and so few places to invest. But you have lots of entrepreneurs trying to raise money at the low end and find that they can't get funding because of this mismatch. I think that there is an opportunity there.
It's clear to me when you do private equity well, you're making companies more efficient and helping them grow and become more profitable. That success means our investors - such as public pension funds - benefit, which contributes to the economic wealth of society.
I'd been a great angel investor, but professional venture capital was clearly not the right thing for me.
I don't think a lot of people have been entrepreneurial about venture capital.
I'll say this: I can't think of one instance in my 20 years in venture capital in which I have wanted to sell a company before the entrepreneur.
In the '70s and '80s, what private equity did is it changed corporate America. It started holding companies accountable, and for the first time managers started thinking like owners.
I'm invested in about 13 private companies. I've advised probably another 50 private companies.
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