Private equity bought out your doctor and bankrupted Toys”R”Us. Here’s why that matters.

Private equity bought out your doctor and bankrupted Toys”R”Us. Here’s why that matters.

The idea behind private equity or PE is simple: a private equity firm gathers up a bunch of cash, raises some investor cash and takes on a lot of debt to buy various companies, often taking them off the public stock market. Then, they usually install new management and embark on aggressive cost cutting and turnaround programs – mostly because they have to pay down all that debt pretty fast. Then, the company can be sold or taken public again for a hefty profit. But don’t worry—if it doesn’t work out, the PE firms are extracting fees at every step of the process so they get paid no matter what happens. In another world, these PE deals are just boring financing strategies or maybe the backbone of the occasional juicy corporate takeover story. In Decoder world, PE is everywhere. Since the modern PE industry kicked off in the 1980’s, it’s grown virtually unchecked, and as author Brendan Ballou explains, that’s had seriously negative consequences for all kinds of markets and consumers. Private equity affects everything from the modern nursing home industry, to the Solarwinds hack, one of the biggest hacks in U.S. history. Brendan Ballou is the author of Plunder: Private Equity’s Plan to Pillage America. Brendan is also a federal prosecutor and he served as Special Counsel for Private Equity in the antitrust division at the Department of Justice, so he’s uniquely suited to writing a book like this. Although he will be the first to tell you, the book does not reflect the views of the DOJ. This is a wonky episode, but it’s essential. Links: Plunder by Brendan Ballou How Private Equity Buried Payless - The New York Times Barnes & Noble is going back to its indie roots to compete with Amazon - Decoder, The Verge How arson led to a culture reboot at Traeger, with CEO Jeremy Andrus - Decoder, The Verge Opinion | Private Equity Is Gutting America — and Getting Away With It - The New York Times Ticketmaster, Taylor Swift, and antitrust – explained - The Verge What is chokepoint capitalism, with authors Cory Doctorow and Rebecca Giblin Credits: Decoder is a production of The Verge, and part of the Vox Media Podcast Network. Today’s episode was produced by Jackie McDermott and Raghu Manavalan, and it was edited by Callie Wright. The Decoder music is by Breakmaster Cylinder. Our Editorial Director is Brooke Minters, and our Executive Producer is Eleanor Donovan. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Recode Decode: Deeds Not Words' Wendy Davis

Recode Decode: Deeds Not Words' Wendy Davis

Former Texas State Senator Wendy Davis -- most famous for her filibuster to stop legislation that would severely restrict abortions in that state -- talks with Kara Swisher about her new digital initiative Deeds Not Words, which hopes to mobilize young women into political action. She discusses her history of confronting misogyny and discrimination, both in real life and online, and why progress in women's rights has been so slow. Davis thinks women must forcefully call out attempts to silence them and learn to put a human face on grim statistics. Learn more about your ad choices. Visit podcastchoices.com/adchoices

2 Maj 201643min

Recode Decode: Keith Rabois says winter is coming for wasteful startups

Recode Decode: Keith Rabois says winter is coming for wasteful startups

Khosla Ventures investment partner Keith Rabois talks with Kara Swisher about building PayPal before the dot-com crash and the entrepreneurial lessons he applied from that company to later jobs at LinkedIn, Slide, Google and Square. Now, as a venture capitalist, he sees himself as a consulting psychologist for many companies in his portfolio. He also discusses why investors who once feared missing the next Uber are now rejecting startups with high burn rates. Learn more about your ad choices. Visit podcastchoices.com/adchoices

25 Apr 201651min

Recode Decode: Steve Case’s “Third Wave”

Recode Decode: Steve Case’s “Third Wave”

Investor and former America Online CEO Steve Case, the author of a new book called "The Third Wave," talks with Kara Swisher about how companies like AOL made on-ramps to the Internet and where we'll find the next big ideas. He dissects why the notorious AOL Time Warner merger failed and explores what the big market leaders need to do to stay on top. America can create millions of new jobs, he argues, by expanding the startup mentality nationwide, including to non-tech sectors. Learn more about your ad choices. Visit podcastchoices.com/adchoices

18 Apr 201650min

Recode Decode: Dave Gilboa and Neil Blumenthal, co-CEOs, Warby Parker

Recode Decode: Dave Gilboa and Neil Blumenthal, co-CEOs, Warby Parker

Warby Parker co-founders and co-CEOs Dave Gilboa and Neil Blumenthal talk with Re/code's Senior Commerce Editor Jason Del Rey about how they challenged the incumbents of the eyewear business, which is dominated by one company, Luxottica. They explain why they expanded beyond their online sales business into old-fashioned retail stores and why, even in the digital age, a strong brand name is vitally important for fashion. Plus: Where did the name "Warby Parker" come from? Learn more about your ad choices. Visit podcastchoices.com/adchoices

11 Apr 201639min

Recode Decode: Anne Wojcicki, CEO, 23andMe

Recode Decode: Anne Wojcicki, CEO, 23andMe

Kara Swisher talks with 23andMe CEO Anne Wojcicki about why the personal genomics company's mission is unchanged after a battle with the FDA. Wojcicki argues that understanding one's own genetic traits is part of a broader trend of consumers taking control of their health. She also discusses being a famous female tech executive, what she thinks of 23andMe's embattled peer Elizabeth Holmes of Theranos and why she doesn't read her own press (especially when it is about her relationship with New York Yankees star Alex Rodriguez). Learn more about your ad choices. Visit podcastchoices.com/adchoices

4 Apr 201655min

Recode Decode: Renaud Laplanche, CEO, Lending Club

Recode Decode: Renaud Laplanche, CEO, Lending Club

Lending Club CEO Renaud Laplanche talks with Kara Swisher about the benefits of online financial services in a world that no longer needs old-fashioned bank branches. He also explains why Lending Club's stock has been slipping for two years and is currently at half its IPO share price. Plus: Why the venture capitalist honeymoon with private financial tech companies might be ending and why Laplanche is bracing for a general market downturn. Learn more about your ad choices. Visit podcastchoices.com/adchoices

28 Mars 201638min

Recode Decode: Chamath Palihapitiya, Investor, Social Capital

Recode Decode: Chamath Palihapitiya, Investor, Social Capital

Social Capital founder Chamath Palihapitiya talks with Kara Swisher about working on Winamp, AOL Instant Messenger and Facebook before becoming an outspoken investor. In today's Silicon Valley, he says, old investment firms are dying and the next hundred-billion-dollar companies will be more diverse and open-minded. He also evaluates Twitter, Yahoo and the racial animosity of Donald Trump. Learn more about your ad choices. Visit podcastchoices.com/adchoices

21 Mars 20161h 9min

Recode Decode: Orion Hindawi, CEO, Tanium

Recode Decode: Orion Hindawi, CEO, Tanium

Tanium CEO Orion Hindawi talks with Re/code's Arik Hesseldahl about why it's easier than ever for hackers to strike at companies and governments, and why those who cling to obsolete security solutions are putting everyone at risk. Hindawi says we're hearing about more security breaches, but that doesn't necessarily mean more are happening. Plus: Why the coconut-water-drinking corporate culture in Silicon Valley is wasteful, irresponsible and headed for a fall. Learn more about your ad choices. Visit podcastchoices.com/adchoices

14 Mars 201647min

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