from Hacker News

Ask HN: Spending time on VCs other bets

by canterburry on 7/23/20, 4:42 PM with 2 comments

Our company was bought some time ago by a private equity firm which also has many other holdings than us.

Our company holds many excellent people in key roles. We are increasingly spending our time on helping the equity company run and increase the value of their other holdings and find ourselves with less and less time running our own business.

For example, our VP of marketing is being asked to "help out" running marketing campaigns for other ventures. Same with our VP of finance and biz dev.

We hold no equity in their other bets. Is this common?

  • by brudgers on 7/23/20, 7:56 PM

    Private equity is not venture capital. Venture capital primarily seeks returns via increasing the value of the equity of portfolio businesses. Private equity typically seeks returns via cash flow using the assets of the underlying business. In your description, private equity is using human resource assets to increase value elsewhere in its portfolio. The private equity probably has little upside in increasing the equity value of your company owing to the likely circumstances of its sale. Good luck.

  • by smt88 on 7/23/20, 4:50 PM

    I don't know if it's common, but does it matter? Doesn't the PE firm that owns your employer get to decide how you spend your work time?