Private capital is taking over—recapped
Private capital, like private equity and venture capital, is impacting the health of our economy—exploiting workers, closing down sustainable businesses, and suppressing innovation in the areas where we need it most.
On September 9th, journalist Megan Greenwell and TechEquity CEO/Founder Catherine Bracy—who wrote books about private equity (Bad Company) and venture capital (World Eaters), respectively—discussed how different forms of private capital affect the lives of everyday people. Their conversation was moderated by Natalie Foster, President and Co-Founder of Economic Security Project and author of The Guarantee.
Were you unable to attend the event? Don’t worry! Here are our main takeaways:
- The venture capital (VC) and private equity (PE) industries have core narratives. For VC, they’re taking risky investments in the technologies and technologists of tomorrow. For PE, they’re trying to breathe new life into almost dead companies.
- While these narratives have some truth in them, both industries have evolved into corrupted versions of these visions, enabled by deregulation that started in the 1970s. For instance, in the current model, many VC companies incentivize rapid growth over creating revolutionary products and sustainable business practices. Meanwhile, private equity is buying companies by loading them with debt and then driving them to bankruptcy.
- Now, as the Trump administration loosens rules preventing people from investing their 401(k)s in private capital, VC and PE are poised to bring all of the risk and hubris they are associated with much closer to the core of the American financial system.
- But there are ways some communities have come together to fight the impacts of private capital, like laid-off Toys ‘R’ Us workers who convinced pension funds across the country to divest from private equity.
Want to learn more? Check out this summary of World Eaters and the books of all of the amazing authors who spoke at the event.
