But they don’t look anything like they did in the 80s and 90s.

Buyout firm's old look

Buyout firm's old look

They look more like this.

Private Equity's new look

Private Equity's new look

It’s a frenzy these days! Today: MyPublisher, Inc. just bought howfasttimeflies.com. Orange is buying Daily Motion. There were dozens more big ones since the year began.

And any and everyone’s raising money right now.

The Buyout biz is back, baby!

Is this a fair claim?

Venture Capitalists, as is the name these days, take a big pool of cash and debt from pension funds and other big funds (often from the private equity sector), and invest in startups that have big growth potential (this differentiates them the most from buyout firms).. so much growth potential that the start-ups (backed by the VCs) have to buy up companies that compliment them and the startup’s competors (starting to look familiar)…

Hopefully, the VC-backed startup IPOs… or, at least, builds up a huge valuation on secondary markets like Facebook did on Second Market. That’s the end game and where all the cash lies for the VCs.

And at least VCs aren’t gutting the companies they buy just to gain margin like in private equity “buyout” firms did in the old days…
Let’s, of course, keep AOL, Yahoo!, and Myspace out of this. Those jobs were cut because of a slip in potential net gain because of mismanagement after the buyout…

Wait, that has always been the reason…

Private equity isn’t bad… I don’t think. In fact it’s necessary if there’s going to be any movement in a capitalist market (ya need the capital after all, or all you have is isms). But like the price of stock, the face of private equity goes through many different phases. Many people have many different perceptions of it… and it seems like it’ll keep changing… for better of for worse.. and it looks like we’re all here for the ride.

What do you think?