Lessons In Private Equity From David Rubenstein

The Carlyle Group LP (NASDAQ: CG) is arguably one of the most successful private equity and alternative asset management firm in the world today. David Rubenstein, co-founder and co-CEO of the company, was on this week's edition of Wall Street Week to discuss what private equity means to him and how it's beneficial for the overall economy.

Different Things For Different People

"Private equity means different things to different people, and that's just saying private equity being synonymous with buyouts," Rubenstein said. "A buyout is when you are buying something that's not working that well. You go in and, you as an owner and a manager, you try to make the company more efficient, typically in a private setting.

"So, you buy it, you put in new management typically or you do things different to make it more valuable. And then in 3, 4, 5 years, you can sell it or take it public or do something to show the world what you have done to make the company more valuable."

Related Link: David Rubenstein Says Valuations In Some Of The Unicorns Will Come Down

Good Thing For The Economy

He continued, "It's a very important thing, because as companies become better operated and more productive, they do a good thing for the economy. They pay taxes, they employ more people, and this is something I have seen around the world. Around the world, people like what we've done in the United States in private equity, what the whole industry has done.

"And so, around the world many people say, 'Can you do in our country what you've done in your country- make companies more efficient, make them more productive? And our employees will get better jobs,' and so forth," Rubenstein concluded.

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