KKR's Kravis Argues P.E. Needs To Tell A Better 'Story'

Feb 26 2014 | 10:51am ET

Private equity firms aren't doing enough to bolster the industry's reputation, according to one of its most prominent executives.

Kohlberg Kravis Roberts co-founder Henry Kravis told the SuperReturn International conference in Berlin yesterday that "we've done a lousy job of telling our story. People think private equity is hedge funds. We have not done a good job as an industry."

Kravis did his best to argue that p.e. is neither a synonym for hedge funds nor the corporate raiders of yore.

"This is not a game of financial engineering," he said. Private equity firms need "a proper capital structure to invest in a business," and that loading debt onto portfolio companies "ain't gonna work." And he complained that banks are not helping the situation, offering leverage beyond "levels of safety" for U.S. buyouts.

The 70-year-old also assured the audience that neither he nor his cousin and co-CEO, George Roberts, were going anywhere.

"I love what I'm doing, George loves what he's doing," he said, adding that they plan to lead KKR as long as they are "healthy and having fun and our partners don't kick us out."


In Depth

GSAM’s Papagiannis on Liquid Alternatives

May 25 2016 | 5:07pm ET

The popularity of liquid alternatives strategies has blossomed in recent years,...

Lifestyle

From Modern Trader: Stephen Curry is a Black Swan

May 18 2016 | 7:43pm ET

What do the rise of the Internet, the sinking of the Titanic, 9/11, and Stephen...

Guest Contributor

LendingClub and the Question of Internal Hedge Funds

May 19 2016 | 8:42pm ET

Peer-to-peer lending platform LendingClub Corp. has been in the news since the firm...