Lyn Alden: Private equity-backed businesses face higher failure rates due to leverage

Lyn Alden: Private equity-backed businesses face higher failure rates due to leverage
Private equity often boosts business failure

Lyn Alden, founder and CEO of Lyn Alden Investment Strategy, states that businesses emerging from private equity funds typically experience higher failure rates as they are often highly leveraged.

She suggests an alternative approach that involves acquiring businesses to own, maintaining their culture, and supporting them with a strong balance sheet.

Alden has previously noted that the new Fed chairman’s initial press conference was hawkish, contributing to a decline in rate-sensitive assets, according to a prior article. She also highlighted that bonds underperformed as the U.S. used inflation to offset deficits in the 2020s, as discussed in a separate report. These observations frame her views on financial stability and leveraged business models.

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