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Entrepreneurship Suffers When Well-Paid Jobs Are Plentiful

The Horizons Tracker

The author believes that while lower costs of capital would certainly help raise the entrepreneurship rate, it would be most beneficial to entrepreneurs with lower skills. This would have less of an impact on higher-skilled entrepreneurs, for whom the decline has been most pronounced. in 2012.

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CEOs Don’t Care Enough About Capital Allocation

Harvard Business Review

” A quarter century later, not much seems to have changed: fewer than five out of the 100 CEOs on HBR’s 2014 list of best-performing CEOs even mention “return on capital” on their official biography — and none of those five lead companies listed in the Dow Jones Industrial Average (DJIA) or in the EuroStoxx50.

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What Private Equity Investors Think They Do for the Companies They Buy

Harvard Business Review

” PE firms typically take three types of value increasing actions — financial engineering, governance engineering, and operational engineering. Private equity as we define it in this paper does not include venture capital investments.). Do PE investors do what the academy says are “best practices?”

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The Key to a Jobs Plan that Works

Harvard Business Review

Banks aren't looking for cheaper capital; they are looking for lower risk. Cost of capital is passed on to the businesses borrowing the money so it is not a huge factor for lenders.) Thus, the government must find a way to reduce the risk for the banks while reducing the cost of capital for the businesses.

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What Shareholder Value is Really About

Harvard Business Review

Companies that manage for shareholder value, the thinking goes, do whatever it takes to engineer an ever-higher market price. A CEO's job is about resource allocation with a goal of earning a return in excess of the opportunity cost of capital. That is a profound misunderstanding. This requires difficult trade-offs.

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4 Ways Leaders Can Get More from Their Company’s Innovation Efforts

Harvard Business Review

For any business to succeed over the long term, it must earn a return that exceeds its cost of capital. It is through continuously making incremental progress in lowering costs and increasing revenues that firms achieve competitive advantage in their industry. Here are four things leaders can do.

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Case Study: A Short-Seller Crashes the Party

Harvard Business Review

He renamed his company and put a team of engineers to work solving the product’s mechanical, food safety, cost, and design flaws. With the company’s share price sinking and its cost of capital rising, those deals might have to be put on hold. When the Express finally emerged, it was a peach: simple, speedy, and elegant.