#347: What Do Private Equity Firms Actually Do?

Are private-equity firms job-destroying monsters? Or are they knights in shining armor, riding in to fix troubled companies and make the economy work better?When you have a presidential candidate who used to run a private-equity firm, the arguments tend to shed more heat than light.So we decided to look at what private equity firms actually do — by telling the stories of two companies purchased by Bain Capital, the private equity firm co-founded by Mitt Romney.On today's show, we look at a deal gone bad. On a future podcast, we'll look at another deal that turned out differently.Romney's campaign wouldn't comment on tape for the podcast, but they did send us this statement:"Mitt Romney spent 25 years as a businessman and entrepreneur. ... At Bain Capital, he helped launch and guide a private equity and financial services firm. Bain Capital invested in many businesses; while not every business was successful, the firm had an excellent overall track record and created jobs with well-known companies like Staples, Dominos, and Sports Authority."