Private Equity Can Make Firms More Innovative
Harvard Business Review
JUNE 29, 2015
And a recent working paper out of the Dusseldorf Institute for Competition Economics ( DICE ), a think tank of sorts, focuses on the latter by exploring whether leveraged buyouts (LBOs) make firms more innovative. PE investors don’t typically invest in firms known for innovation. Startups, on the other hand, aren’t debt financed, because they’re too risky and unproven, and have no assets—not so appealing to lenders.