Defending Private Equity from a Flawed Picture – The DealBook

In a July 6 post on The New York Times’ “DealBook” blog, Steve Klinsky, Founder and Chief Executive of New Mountain Capital, and Chairman of the Growth Capital Committee within the PEGCC, responded to a blog posted days earlier by Steven M. Davidoff on the image differences between private equity and venture capital.  You can read the full article, here.

Citing research conducted by Ernst & Young and Harvard Professor Josh Lerner, Mr. Klinsky demonstrates that private equity both creates lasting value for the companies in which it invests, and helps many portfolios grow jobs, leading to higher employee wages, competitive benefits and better job security.

More and more, Mr. Klinksy points out, private equity and venture capital operate similarly, with many PE firms increasingly involved in starting companies from the ground up, working side by side with venture capital firms.

Mr. Klinksy states in his piece that, “Private equity, when properly executed, is a proven asset class that can deliver superior returns to its investors and can provide capital, create jobs and drive positive economic activity at a time when our economy badly needs such support.  It is important to avoid false stereotypes about the private equity industry or any industry in order to prevent flawed public policy.”