Take it from Kohlberg Kravis Roberts, you can’t have too many chiefs when it comes to building a successful private equity firm. According to Financial Times, more than one-third of around of the 30 best managers comes from public companies where they served as chief executives or chief financial officers. And p.e. firms are increasingly able to lure these biggies relatively easily with the promise of lots of money and an escape from newly imposed rigors brought on by new legislation as the result of corporate scandals in recent years. “When they join private equity-backed companies,” KKR partner Marc Lipschultz told FT, “these executives can spend much more of their time on long-term business building rather than on quarterly earnings.” Kevin Conway of Clayton Dubilier & Rice said in an FT interview, that matters will get only worse for public companies. “I don’t think it is a crisis yet, but it is a real issue, especially because private equity focuses on the very best, most talented and most experienced managers.”
