Comment by AndrewKemendo

Usually from a loan or they bought someone out before the PE consolidation in that market really ramped up.

This is the insidious part: small markets that grow organically over about 10-20 years are specifically what PE investors look for because they are cash heavy but don’t have desire to expand.

So the owner gets 3M cash out for property worth 4M. PE bundles similar businesses (boba tea shops are a popular one) and then uses the net cash to get a loan to expand.

They expand, cut corners then cash out on the net profit and then sell the skeleton in the pink sheets or go bankrupt.

I’ve had to deal with investors and finance for almost 15 years now. My company was bought by a PE backed company and I knew fund owners

this is how the economy works