Tech Downturn Won't Trigger a 2008-Style Systemic Crisis, Says Steve Pagliuca
Steve Pagliuca · Celtics Owner Steve Pagliuca: What Went Wrong with the Chelsea FC Acquisition | 20VC #976 · 20VC with Harry Stebbings · Feb 11, 2023 · at 17:08
Steve Pagliuca, Senior Advisor at Bain Capital, compares the tech market correction to the 2008 global financial crisis, arguing equity-based losses do not create systemic collapse.
0:00 / 0:32exact quote · 32.0s
▶ Watch the full episode on YouTube → 720p mp4 · rendered on demand · StarZero watermark
“The positive side of this is all equity dollars, mainly invested. Where you go to a real problem, the crash of 2008 was, you know, based on, on just too much leverage everywhere. When that leverage gets pulled out, you have a crisis. Equity dollars are just lost. You're not loaning it to somebody else. You just lose your equity dollars. So there'll be a carnage of some firms that you know, over invested in this over exuberance, but that will not move the needle like the crash did in, in, in, in, in, because that was driven by, you know, debt, which has a multiplier effect.”
quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →
More from Steve Pagliuca
Buying Market Share With Cash Fails for 90% of Businesses
“There's just been a lot of overinvestment in that philosophy, saying a hoard of cash and buying market share can get you a great business at the end, and that is just not true for 90% of the business.”
Steve Pagliuca Dropped Chelsea Bid After Sellers Permitted Debt and Raised Price
“And we had a group that, that came up with that money, and what was a very rich price, and unfortunately at the last minute they went away from that model, and they allowed debt to go in the business, and they asked for a much higher price than what we were ta…”
Success in Private Equity Requires Having an Ego, Says Steve Pagliuca
“You can't be successful in this business without an ego.”
Internal Employees Contributed Over $1B to Bain Capital's $12B Fund
“Where let's say our last twelve billion dollar fund over a billion of capital has come from all the people in the company. And that, that is, you know, a hundred times more in terms of percentage than most of the investor firms out there.”