When George, Jerry and I founded KKR in 1976, the acquisition method we now call private equity was unknown. After a series of big acquisitions, our business approach garnered attention, including from the media and the U.S. Congress. I'd argue that while no doubt mistakes have been made, including by us and KKR, many have misunderstood (or greatly simplified) the model. They have overlooked how value is created -- and for whom.
It's not possible to create long-term value by simply loading a company with debt and cutting costs. Nobody will partner with you or entrust you with their valuable capital if that is your business model. We would not have stayed in business with the support of our clients if that was our business model.
