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Business Standard
06-07-2025
- Business
- Business Standard
Bad Company: Megan Greenwell's book explores human cost of private equity
Bad Company details how cliched abstractions like "consolidation" and "efficiency" have given cover to real betrayals NYT BAD COMPANY: Private Equity and the Death of the American Dream by Megan Greenwell Published by Dey Street 294 pages $29.99 In 2019, Megan Greenwell had only a 'vague sense' of how powerful private equity had become. Sure, she had heard the stories about Toys 'R' Us, the beloved retailer that went bankrupt after private equity firms bought out the company. 'I knew private equity was a problem,' she writes in her new book, Bad Company. 'I just thought it wasn't my problem.' Greenwell was the editor of Deadspin, an online sports magazine whose mix of investigative reporting and cheeky commentary had attracted a devoted readership. But the magazine and its sister sites were also losing $20 million a year. Enter a private equity firm named Great Hill Partners to the rescue — or not. Greenwell recalls how Deadspin's new owners seemed determined to come up with bad ideas that would run the website's brand into the ground. After three months of being micromanaged she resigned in disgust: 'The firm's goal was never to make our website better or grow its readership. Great Hill Partners, and private equity at large, exists solely to make money for shareholders, no matter what that means for the companies it owns.' It's a business model that Greenwell writes about to potent effect in Bad Company, which emphasises the human costs of private equity. She says she started writing her book 'not out of spite, but out of pure curiosity.' Why did Great Hill Partners flourish financially after reducing Deadspin to a husk of its former self? (Last year the site was sold to a Maltese gambling outfit that uses it to 'drive traffic to online casinos.') Shouldn't a private equity firm make money when the company it buys makes money, and consequently lose money when it doesn't? How could a firm continue to bring in revenue while its acquisitions flounder? Twelve million Americans work for companies owned by private equity, which amounts to about 8 per cent of the labour force. In Bad Company, Greenwell tells the stories of four people whose lives have been upended by the industry. Liz Marin worked for six years at Toys 'R' Us; Roger Gose was a doctor in rural Wyoming; Natalia Contreras was a journalist for a local paper in Texas; Loren DePina lived in a private equity-owned apartment complex in Alexandria, Va. Their stories share a similar arc: Tentative hopefulness followed by a rude awakening. Greenwell offers stories that are textured, not one-note tales of woe. When Liz Marin started working for Toys 'R' Us in 2012, private equity had owned the company for seven years. Although Marin didn't know it, Toys 'R' Us was a retailer in name only; in actual fact, it was a debt-payment machine. Its profits were used to repay the money borrowed by the private equity firms to buy it in the first place. While Toys 'R' Us limped toward bankruptcy, top executives were awarded $16 million in bonuses; the 33,000 rank-and-file employees were simply laid off. But all businesses are part of a larger community: A shuttered store not only inconveniences consumers but also deprives a municipality of tax revenue. And then there is private equity's incursion into health care and housing. Greenwell's chapters on Roger Gose, the Wyoming doctor, show what happens when private equity tries to squeeze rural medicine for profits it cannot produce. The local hospital stopped providing obstetrics services. It also had to pay rent on land it once owned. Greenwell reports that, compared with their peers, companies acquired by private equity firms are 10 times as likely to go bankrupt. Of course, proponents of private equity maintain that this figure isn't surprising, given that private equity specialises in trying to turn around struggling companies, selling itself as 'the hero when no one else is brave enough to shoulder the risk.' But as Greenwell and other critics of the industry have pointed out, private equity firms charge management fees and benefit from tax breaks that sever risk from reward. If a company makes money, its private equity owners make money. If a company loses money, its private equity owners can still make money. Private equity firms collect money from outside investors, including pension funds, to buy companies and run them. Consequently, they like to proclaim that their money making is often done on behalf of public workers like firefighters and teachers. 'The private equity industry argues that working people would be far worse off without it,' Greenwell writes, 'because the returns it generates allow them to retire.' Bad Company details how clichéd abstractions like 'consolidation' and 'efficiency' have given cover to real betrayals. The people in this book wanted only to raise their families and contribute to their communities. Instead they were unwittingly drawn into an opaque system of financial extraction and debt peonage, for which no amount of hard work was ever enough.
New York Times
02-07-2025
- Business
- New York Times
G/O Media Winds Down, Selling Off One of Its Last Sites
G/O Media, the digital media publisher that once owned sites like Jezebel and Deadspin, announced on Wednesday that it is winding down its operations and selling off one of its last properties, the video game website Kotaku. G/O Media, which is owned by the private equity firm Great Hill Partners, once owned a collection of websites that had belonged to the Gawker Media blog universe and The Onion. But it has slowly been shedding its holdings. With the sale of Kotaku, only one website remains: The Root, which covers Black culture and news. G/O Media's chief executive, Jim Spanfeller, said in a statement on Wednesday that 'it became clear to our investors that it was time to move on,' alluding to a series of challenges that have faced the digital media industry in recent years. Publishers have been battling for advertising against tech giants like Google and Meta, while generative A.I. is reshaping the media landscape. Investors don't see a promise of growth in digital publishing in the way they did before the pandemic. Mr. Spanfeller was quick to say that Great Hill had been 'a very good partner' and had 'never weighed in on editorial direction.' 'This is in no way a suggestion that Great Hill was in some way acting like a rapacious private equity firm,' he said. Want all of The Times? Subscribe.
New York Times
02-07-2025
- Business
- New York Times
The Private Equity Wager: Heads We Win, Tails You Lose
BAD COMPANY: Private Equity and the Death of the American Dream, by Megan Greenwell In 2019, Megan Greenwell had only a 'vague sense' of how powerful private equity had become. Sure, she had heard the stories about Toys 'R' Us, the beloved retailer that went bankrupt after private equity firms bought out the company and saddled it with crushing amounts of debt. 'I knew private equity was a problem,' she writes in her new book, 'Bad Company.' 'I just thought it wasn't my problem.' At the time, Greenwell was the editor of Deadspin, an online sports magazine whose mix of investigative reporting and cheeky commentary had attracted a devoted readership. But the magazine and its sister sites were also losing $20 million a year. Enter a private equity firm named Great Hill Partners to the rescue — or not. Greenwell recalls how Deadspin's new owners seemed determined to come up with bad ideas that would run the website's brand into the ground. After three months of being micromanaged, she resigned in disgust: 'The firm's goal was never to make our website better or grow its readership. Great Hill Partners, and private equity at large, exists solely to make money for shareholders, no matter what that means for the companies it owns.' It's a business model that Greenwell writes about to potent effect in 'Bad Company,' which emphasizes the human costs of private equity. She says she started writing her book 'not out of spite, but out of pure curiosity.' Why did Great Hill Partners flourish financially after reducing Deadspin to a husk of its former self? (Last year the site was sold to a Maltese gambling outfit that uses it to 'drive traffic to online casinos.') Shouldn't a private equity firm make money when the company it buys makes money, and consequently lose money when it doesn't? How could a firm continue to bring in revenue while its acquisitions flounder? What is it like to work for a company whose owners don't necessarily have its best interests at heart? Twelve million Americans work for companies owned by private equity, which amounts to about 8 percent of the labor force. In 'Bad Company,' Greenwell tells the stories of four people whose lives have been upended by the industry. Liz Marin worked for six years at Toys 'R" Us; Roger Gose was a doctor in rural Wyoming; Natalia Contreras was a journalist for a local paper in Texas; Loren DePina lived in a private equity-owned apartment complex in Alexandria, Va. Their stories share a similar arc: tentative hopefulness followed by a rude awakening. 'Bad Company' is definitely a critical take on the industry, told through the point of view of its victims. But Greenwell offers stories that are textured, not one-note tales of woe. When Liz Marin started working for Toys 'R' Us in 2012, private equity had owned the company for seven years. Marin liked the fact that the company gave her the ability to advance and to transfer easily to other stores. Having worked in retail before, she was impressed by what she experienced at her new job. Toys 'R' Us stores seemed busy and well run. She even got a tiny tattoo of Geoffrey the Giraffe, the company mascot, on her left shoulder. Want all of The Times? Subscribe.
Glasgow Times
05-06-2025
- Business
- Glasgow Times
Three Rangers directors leave as club undergoes shake-up
The trio have been replaced by new faces as the club undergoes a shake-up. Their positions on the board will be filled by Americans Mark Taber, Andrew Clayton, and Gene Schneur. The departure of Johnston, Park, and Wolhardt has been officially recorded on Companies House, with all three having their appointments terminated. A new chairman, Andrew Cavenagh, has been appointed, replacing Fraser Thornton, who will remain on the board. Read more: Paarag Marathe has taken on the role of vice-chairman. John Halsted and George Taylor will continue as directors, while chief executive Patrick Stewart remains in his role. The new board members bring a wealth of experience to the club. Mark Taber, a managing director at Boston-based growth equity firm Great Hill Partners, specialises in healthcare investments. Andrew Clayton is co-founder and vice-chairman of ParetoHealth, a health insurance company founded by Cavenagh. Gene Schneur, a board member and co-owner of Leeds United, is the third new face on the board. Their appointments mark a new era for Rangers.
The Herald Scotland
05-06-2025
- Business
- The Herald Scotland
Rangers board changes made official as trio stand down
Their roles will be filled by Americans Mark Taber, Andrew Clayton, and Gene Schneur. The exits of Johnston, Park and Wolhardt have been officially confirmed in an update on Companies House, all three having their appointments terminated. Cavenagh takes over from Fraser Thornton as chairman but the latter will continue to be part of the board. Read more: Paarag Marathe is the new vice-chairman. John Halsted and George Taylor remain on the board as directors and chief executive Patrick Stewart stays in his role. New board member Taber is managing director at Great Hill Partners, a growth equity firm based in Boston. He specialises in healthcare investments and has been on the boards of over a dozen healthcare companies. He is also a trustee of Boston Medical Centre's HealthNet health plan and a member of its finance committee. Clayton is the co-founder and vice-chairman of ParetoHealth, a health insurance company founded by Cavenagh. Schneur, a board member and co-owner of Leeds United, is the third new face.
