Hello and welcome to Behind the Buyouts, The Deal’s podcast where we sit down with pros from the world of private equity and venture capital and drill down into their deals.
In this podcast, TJ Maloney shares his long view on private equity as chairman and CEO of Lincolnshire Management Inc., the New York-based middle-market firm, where he’s worked since 1993.
While more public pension fund money is being invested in private equity and other alternatives, the public perception of PE as job killers seems to persist.
Asked for his perspective on this issue, Maloney said: “The reality is that 99% of the time, private equity investments are creating jobs, and it’s kind of logical right? You want to grow a company. And if you grow the company and grow the earnings, you’re going to do better for your investors. I think there’s a misconception or Hollywood hype about private equity, but as long as PE continues to deliver strong returns, I think their voice will prevail.”
As a guest lecturer at Fordham University and Columbia Business School, Maloney said students often ask him to share “war stories” about the financial crisis.
Lincolnshire navigated the Global Financial Crisis in 2008 because it had sold a number of portfolio companies before the crash. The firm’s value investing approach to avoid overpaying for portfolio companies also serves it well during economic downturns, he said.
Maloney talked about growth at Lincolnshire portfolio company Powerhouse Retail Services LLC, a provider of high-volume, multi-site rollouts and refreshes for retailers.
He also shared thoughts on some of the firm’s other notable investments over the years.