Networth and Chill with Your Rich BFF

Episode: What is Private Equity ACTUALLY & How Does it Affect YOU?
Host: Vivian Tu
Date: November 5, 2025

Episode Overview

Vivian Tu, aka Your Rich BFF, demystifies the world of private equity (PE), breaking down what it is, how it works, and—most importantly—how it touches the lives of regular consumers. Far from being a distant Wall Street concern, private equity turns out to shape everything from your protein bar’s taste to your favorite neighborhood restaurant and even some of your go-to apps. The episode covers the business mechanics of private equity, its impact (good, bad, and ugly), and answers listener questions on investing, work-life changes, and the realities of capitalism.

Key Discussion Points & Insights

1. Defining Private Equity (00:53)

Simple Definition: "Private equity, simply put, is just ownership of a company that is not publicly traded on a stock exchange."
Small business owners technically possess private equity; the industry refers to large-scale activity of raising investor money to buy entire companies, improve them, and later sell at a profit. PE firms are like “sophisticated house flippers… renovating entire businesses.”
— Vivian Tu

Notable Quote:

"Think of private equity firms as really sophisticated house flippers. But instead of renovating kitchens and bathrooms, they're renovating entire businesses."
— Vivian Tu (01:18)

2. How Private Equity Firms Work (03:40)

Structure:
- GPs (General Partners): Manage and select investments.
- LPs (Limited Partners): Provide most of the capital, often institutional investors (pension funds, insurance companies, sovereign wealth funds).
Fee Structure:
- Management Fee: Typically 2% annual fee—“like a membership to a country club.”
- Carried Interest (“Carry”): GPs keep 20% of the profits generated, incentivizing high returns.
Buy, Improve, Sell: Example given where a $100M business is bought, improved, and resold for $200M. GPs and LPs share in the upside.

Notable Quote:

"The goal of PE companies is always the same. Make the company more valuable and more profitable than when they bought it, then sell it for a hefty return. It's the buy, improve and sell model."
— Vivian Tu (07:38)

3. Private Equity’s Pros and Cons: The Good, The Bad, The Ugly (10:12)

The Good:
- PE can rescue failing businesses, bring in capital and professional management, create jobs by fostering growth.
The Bad:
- Focus is on “maximizing profits for LPs,” leading to cost-cutting measures: layoffs, benefit reductions, service or quality reduction (“optimization can be genuinely painful for employees and communities”).
- Price gouging can occur, especially in monopolistic scenarios (the only auto repair in town—prices go up, quality may go down).
The Ugly:
- Impact on essential services, especially healthcare (staff cuts affect patient care).
- Debt loading can destroy companies (e.g., Toys R Us).
- Major contributors to wealth inequality; lack of transparency and accountability due to being private.

Notable Quotes:

"Your favorite protein bar tastes like shit now. Maybe it's private equity. Your local auto repair shop charges twice as much now. Probably private equity."
— Vivian Tu (02:01)

"PE partners can make hundreds of millions, while the workers at their portfolio companies could face layoffs and pension cuts."
— Vivian Tu (14:26)

4. Where Private Equity Touches Everyday Life (17:30)

Consumer Companies:
- Many well-known chains (Panera, Burger King, Dunkin, Petco, Dollar General) have been PE-owned.
- Examples where PE ownership has gutted quality or jacked up prices.
Healthcare’s Vulnerability:
- Increasingly targeted due to its essential nature and “opportunity” for PE to impose efficiencies (often meaning cuts).
Employee Impact:
- Expect “corporate speak” post-acquisition, layoffs, higher expectations, trimmed benefits.

Notable Quote:

"If your company has recently been acquired by PE, don't panic, but do be realistic. PE ownership often means the company culture and job security you're used to are about to change dramatically."
— Vivian Tu (21:45)

5. Listener Q&A: Investing and Impacts (24:40)

a. Can Regular People Invest in Private Equity? (24:45)

Not easily (meant for institutional and accredited investors), though some 401k plans may soon offer it.
- “This administration just made private Equity Investments in 401k accounts legal.”
PE is riskier, not a starter investment.

b. Negative Impacts on People & Communities (26:13)

PE optimizations often prioritize money over community or worker well-being:
- “These companies are to make money, not to help people.” (30:32)

c. PE’s Tax Advantage Explained (31:10)

Gains taxed as capital gains (max 15%), versus ordinary wage income (up to 37%).
- “That is why politicians want to reconsider how carry is taxed.”

d. How Much of a Portfolio Should Be PE? (33:02)

“It’s like the top of the food pyramid—candy and chips. ... Maybe 5–10% at most, and only if you already have millions elsewhere.”

e. Is PE Ever Good for All Stakeholders? (35:07)

Mostly good for people with a financial stake (GPs, LPs, executives), rarely for communities or workers.

f. Differentiation from Public Equity (37:00)

In public equity (the stock market), anyone can buy shares; private equity is locked away.

Memorable Quote:

"There is no such thing as conscious consumerism under capitalism. People are out here to make money … and until we can get people to value something else more than money … it's going to take a while for people to really prioritize other things."
— Vivian Tu (33:52)

6. Vivian’s Verdict & Takeaways (39:08)

PE is “neither the savior nor the villain”—it’s a tool, and results depend on how it’s wielded.
"Knowledge is power," and understanding finance—even esoteric realms like private equity—empowers you as a consumer and potential investor.
If you’re not maxing out retirement accounts, building an emergency fund, and investing in low-cost index funds, don’t focus on PE just yet.

Final Notable Quote:

"Private equity isn't some mystical financial wizardry that only affects billionaires. It's literally everywhere in your daily life. … The biggest lesson: knowledge is power. Especially in the world of finance."
— Vivian Tu (39:08)

Memorable Quotes by Timestamp

| Timestamp | Quote | Speaker | |-----------|-------|---------| | 01:18 | "Think of private equity firms as really sophisticated house flippers. But instead of renovating kitchens and bathrooms, they're renovating entire businesses." | Vivian Tu | | 02:01 | "Your favorite protein bar tastes like shit now. Maybe it's private equity. Your local auto repair shop charges twice as much now. Probably private equity." | Vivian Tu | | 07:38 | "The goal of PE companies is always the same. Make the company more valuable and more profitable than when they bought it, then sell it for a hefty return. It's the buy, improve and sell model." | Vivian Tu | | 14:26 | "PE partners can make hundreds of millions, while the workers at their portfolio companies could face layoffs and pension cuts." | Vivian Tu | | 21:45 | "If your company has recently been acquired by PE, don't panic, but do be realistic. PE ownership often means the company culture and job security you're used to are about to change dramatically." | Vivian Tu | | 33:52 | "There is no such thing as conscious consumerism under capitalism. People are out here to make money … and until we can get people to value something else more than money … it's going to take a while for people to really prioritize other things." | Vivian Tu | | 39:08 | "Private equity isn't some mystical financial wizardry that only affects billionaires. It's literally everywhere in your daily life. … The biggest lesson: knowledge is power. Especially in the world of finance." | Vivian Tu |

Important Timestamps

00:53—Definition of PE, real-life examples
03:40—Structure of PE firms: GPs vs. LPs
05:20—Fee structure and profit splits
07:38—Illustrative example of a PE deal
10:12—The Good/Bad/Ugly of PE
17:30—How PE shows up in your daily life
21:45—Impact of PE ownership if your company is acquired
24:45—Q&A: Access, effects, and why everyone seems to hate PE
31:10—PE’s tax advantages vs. regular income
33:02—How much PE should you own?
39:08—Host’s closing verdict and main takeaways

Tone and Style

Vivian Tu’s signature is clarity, humor, and sharp real talk. She keeps things light, hands-on, and unpretentious—a finance explainer made for actual humans, not industry wonks.

Summary Takeaway

Private equity is everywhere—shaping the businesses we depend on, the jobs we hold, and often the costs (and quality) of goods and services in our lives. Its mission is always profit, for better or worse, and its reach is broader than you think. Learning about PE isn’t just for the ultra-wealthy; it’s a key to understanding the hidden forces influencing daily living—and preparing for larger investing or career moves in the future.

Transcript

A (0:00)

Private equity. What even is it? Think of private equity firms as really sophisticated house flippers. But instead of renovating kitchens and bathrooms, they're renovating entire businesses. PE is wonderful. Everyone loves it. And what could possibly go wrong, right? Well, not quite. Your favorite protein bar tastes like shit now. Maybe it's private equity. Your local auto repair shop charges twice as much now. Probably private equity. These companies are to make money, not to help people. Foreign. What's up rich friends? I'm your host Vivian too, AKA your rich BFF and your favorite Wall street girly. Today we are doing a deep dive into everybody's favorite and definitely not confusing at all topic, private equity. What even is it? What does it do and why does everybody seem to hate it? Private equity touches way more of your daily life than you probably realize that that coffee shop you love could be PE owned, your favorite restaurant chain, probably backed by private equity. And even some of the apps on your phone. Yep, funded through private equity money. So today we are going to break down exactly what private equity is, how it actually works, and most importantly, what it means for you. Let's get into it. Support for the show comes from Bumble. In dating, just like in finance, you tend to get out what you put in. The more intention and openness you bring to the table, the more likely you are to see the kinds of returns that matter deeper, lasting connections. That's why I'm excited to talk to you about Bumble. Today's sponsor, Bumble encourages people to show up as their most authentic self, helping them to date with clarity and confidence. So when you find a spark, you can explore it with an open mind. If you're thinking about dating, you can jump right in with Bumble. So first and foremost, what even is private equity? Private equity, simply put, is just ownership of a company that is not publicly traded on a stock exchange. So if you're an entrepreneur who owns your company and other people can't buy stock in your brand, you that's technically private equity. I have private equity in your rich BFF because I own the company and you, somebody listening at home cannot buy into my company. Your neighborhood baker owns the private equity in her bakery. Now, what people typically refer to as private equity is more so the private equity industry. This is the process of raising money from investors and using that money to make investments, oftentimes by companies. More often than not. Buy the playbook is to buy companies, make optimizations to get the business running more efficiently and then selling those businesses for a profit. Like I mentioned, these aren't the companies you can buy stock in on the New York Stock Exchange or on the Nasdaq. These are private companies, or sometimes public companies that PE firms take private by buying up all of the shares. Think of private equity firms as really sophisticated house flippers. But instead of renovating kitchens and bathrooms, they're renovating entire businesses. Remember that baker and bakery example I gave earlier? The bakery isn't a publicly traded company, and you as an individual, can't invest in it. However, a PE firm might swoop in and purchase the bakery, fire half the employees, build an automated factory, and strike up a nationwide distribution partnership with a food delivery service. After all the changes, they'd sell the whole business for a lot more than when they bought the single bakery shop. So. So now that we know what the definition of private equity is, how exactly do these companies function? Let's take a look at the actual structure of a PE firm. The easiest way to think about this is to break it into two groups. The smart people who do all the work, and the rich people who have all the money. A PE firm is generally started by a crew of GPs, general partners. These are the smarties. They do all of the research. They meet with companies and decide what to invest in. But you got to have a lot of money to play in this ball game. So where do these GPS get the money? Not from their own bank accounts. From LPs, limited partners? And while most people think LPs are just uber wealthy individuals, more often than not, LPs are actually financial institutions. So things like pension funds, sovereign wealth funds, AKA money from wealthy countries, insurance companies and banks. Anybody that has billions of dollars that needs to be invested is probably dabbling in private equity. These institutions want to invest in PE because they need to diversify their portfolios. While the majority of their investments are lower risk and lower reward, to hit their performance goals, they typically need to have some exposure to higher risk and higher rewarding investments as well. In return, these LPs pay the GPS a fee to invest with them. So how exactly do these PE companies make money? Well, the typical PE fund charges two types of fees, management and performance. Management fees historically have been 2% of total capital. So if $100 million gets invested into the fund, a $2 million fee annually while the money's invested. Think of this as a membership fee to a country club. But then here's where things get interesting. Because the real money in private equity is in something called carry. PE investors buy private companies, often, make a ton of changes, and then sell them for way More. And when the companies get sold or go public, PE funds can see huge returns. The general partners GPs then get to clip 20% of the upside. So if the investment makes 80%, the limited partners LPs would see a 60% return. That's some serious money. The goal of PE companies is always the same. Make the company more valuable and more profitable than when they bought it, then sell it for a hefty return. It's the buy, improve and sell model. Let's look at a really quick example. Let's say a PE fund finds a company they want to buy for a hundred million. They then go and raise a hundred million from their investors LPs. They then go and use that money to buy the company. The general partners GPs at the PE fund then spend three years improving the company that they bought. They are cutting costs, they're growing revenue, they're optimizing operations. And then they sell it for $200 million. So they double their money. This is how the money gets split. The total profit is a hundred million dollars. It's the $200 million sale minus what they spent a hundred million dollars to buy it. Initially, the PE firms carry is $20 million. So 20% of the $100 million profit. The investors, the LPs get $80 million in profit, which is 80% of the gains. And then plus, the PE Firm collected those 2% management fees every single year. So on this one deal, the pe firm made $20 million in carry on plus roughly $6 million in management fees over three years. Not bad for improving one company. The LPs made $74 million over three years, which is a great 20ish percent return every single year. So they're happy. The GPS of the PE firm made $26 million over three years, so they're happy. PE is wonderful. Everyone loves it. And what could possibly go wrong, right? Well, not quite. You've probably seen the headlines. PE firms are incredibly controversial. Now the question is why? PE funds are often in the news for essentially reducing goods or service quality through their optimizations. In your favorite businesses, both big and small, your favorite protein bar tastes like shit now. Maybe it's private equity. Your local auto repair shop charges twice as much now. Probably private equity. Your company is facing major layoffs. Honestly, maybe private equity here too. So then why are companies taking investment from private equity funds? Here's the good, the bad and the ugly. All right, so let's start with the good. PE can genuinely save struggling companies from bankruptcy. Think about businesses that are drowning in debt or have terrible management. And PE swoops in with both capital and expertise to turn things around. They bring in professional management teams, cutting edge technology, and proven business strategies that smaller companies could never afford on their own. When PE does this right, they actually create jobs. Because growing, profitable companies hire more people. This is a good thing. But now onto the bad. PE firms, in most cases, are focused on maximizing profits for their LPs. And there's a lot of levers to create value. But if we're being really honest, a lot of those levers are incredibly hard to pull. Otherwise everybody would do it. For example, you can improve businesses by inventing new products, selling more of what already exists, or even just convincing other investors the business is worth more than you paid. But again, these are all very time intensive and challenging things to do. So PE oftentimes opts for something easier. Much easier. Cost cutting. This frequently translates to job cuts, benefit reductions, and corner cutting measures that might make the numbers look better, but don't necessarily make the company stronger or benefit those who work at these companies or the communities that they operate in. This optimization process can be genuinely painful for employees and communities. On top of that, another easy way to create value. Price gouging. While the product or service might stay the same if it's the only car wash or plumber in town, these PE firms know you're going to pay whatever they decide to charge, so they're just going to charge you more. In fact, the product might actually get worse and you will still have to pay more. And if that wasn't bad enough, let's talk about the ugly. Here's where things get really controversial. PE can make all of these optimizations in any industry. Their move into healthcare has been particularly problematic. Buying up medical practices, hospitals, nursing homes, and veterinary clinics, then cutting staff and services to boost profits, which can literally impact patient care and safety. When it comes to healthcare, a worse product does in fact mean worse outcomes. Some of the most spectacular business failures in recent history have PE fingerprints all over them. Companies so loaded with debt that they couldn't survive even minor setbacks. The wealth inequality aspect is real, too. PE partners can make hundreds of millions, while the workers at their portfolio companies could face layoffs and pension cuts. And unlike public companies, PE operates with very limited transparency because it is private. So it's often impossible to know who owns what or how decisions are being made. The lack of accountability can lead to some truly predatory behavior if, especially when PE targets essential services. So now let's get into where you might be seeing private equity in your life, you interact with PE owned companies way more than you think. Those restaurant chains you frequent, Panera, Burger King and Dunkin, have all been through PE ownership at various points. Your weekend shopping routine probably includes PE backed retailers like Petco and Dollar General. And if you're old enough to remember the Toys R Us saga, that's a perfect example of how PE can go very wrong. The company was loaded with so much debt from its PE buyout that it couldn't survive the retail Apocalyp. Healthcare is where PE has been particularly aggressive, buying up everything from your local medical practice to entire hospital chains. Even the tech world isn't immune. Many of those apps you scroll through daily and software services you rely on have PE money behind them, though they're often more behind the scenes investments. In those cases, when PE takes over a company you love, you'll often notice changes pretty quickly. And not all of them are good. Pricing changes are usually the first thing you'll see. Sometimes prices go up because they're optimizing profit margins. Other other times they might go down initially to drive volume and squeeze out competitors. Service quality can be a real mixed bag. Sometimes PE brings in better systems and training that improve your experience, but just as often they cut staff and corners to boost profits, leaving you with longer wait times and less personalized service. You might also notice your favorite locations closing if they're not profitable enough, while new locations pop up in higher income areas. Product changes are super common too. PE firms love to streamline offerings, which might mean your favorite menu item disappears or your go to product gets reformulated with cheaper ingredients. And if you work for a company that gets acquired by pe, buckle up because your work life is about to change significantly. The first thing to expect is a lot of corporate speak about synergies and optimization, which usually translates to layoffs, department consolidations and increased workloads for those who remain. Your benefits package might get trimmed, your pension could be frozen or eliminated, and there's often pressure to hit aggressive performance targets. If your company has recently been acquired by pe, don't panic, but do be realistic. PE ownership often means the company culture and job security you're used to are about to change dramatically. So the best thing you can do is stay informed, stay flexible, and have a backup plan. Support for net worth and chill comes from Bumble. No matter how seasoned you are, dating, like any investment, can always feel a little scary. I know so many couples who have met on Bumble who put in time, energy and emotions into finding the right partner. Someone who has shared goals and genuine compatibility. But the more intention and openness you bring to the table, the more likely you are to see the kind of returns that matter. Deep, lasting connections. When you're approaching dating with authenticity, it's also an investment in yourself. Be thoughtful in crafting your Bumble profile and bring the same energy to connections that you hope to receive, because all of that energy enriches you too. Bumble has prompts and interest badges so you can show off your own personality and make it easier to find compatibility with others. You can get to know the little things, like how they take their coffee, and the big things, like their goals for the future. So if you're ready to find a meaningful relationship, one of the most important investments of your life, you can do it on Bumble. Hi friends. Quick pause in our show to take a question from my besties in Phone a Friend, presented by Bumble, where I'm answering your burning questions. Bella asks, who pays on the first date? I actually have a very simple answer for this. I know there is a back and forth of oh, the man should always pay. If it's a man and a woman go on a date, or maybe we should go 50. 50 Dutch is the modern approach. But my answer is much simpler than that. It's whoever invites, pays. Think about it this way. If I invite one of my friends with me to a show or to a brunch or whatever, unless it's discussed in advance that you know, this is going to cost this much for bottomless brunch or it's going to cost this much for the ticket, my expectation is that I'm going to be paying because I'm taking them in the same way. I believe that when you go on a date, it's really important to consider chivalry. But also setting this expectation of if I invite, I pay. This really, really goes back to communication. You want to make sure that you are communicative about money, that you are respectful. Because I know the first date can feel scary for a number of reasons. Not only is it stressful because you're meeting someone for the first time, but that awkward, oh, should I grab the check at the end thing. Yeah, it can. It can feel really overwhelming. And for it to just be one less thing to think about if you are the person inviting you should pay. Now that you've gotten the easy to understand download, let's get into some Q and A. First up, how can I as a regular person invest in private equity? Well, it's not easy and in most cases you can't. However, some retail trading platforms are starting to bring on private equity investment opportunities. Additionally, you may have seen the headlines, this administration just made private Equity Investments in 401k accounts legal. This doesn't automatically mean your 401k money will be invested in private equity. But if your 401k plan administrator decides that it's a solid investment that can make sense for a bunch of the employees at your company, they may make it available as an investment option for you to select up Next how does private equity negatively impact people and communities? Why does everyone hate it if it's just investing? Like I mentioned a little bit earlier, more often than not private equity investments are beholden to the LPs, aka the people who gave that money in the first place. So their job is not to prioritize the workers at the company. It is not to prioritize the community that they serve. Like the whole family values of a mom and pop shop that is going to do right and save the town. And the Lifetime movie doesn't apply here. These companies are to make money. They want to make money, they want to optimize, they want to increase top line revenue and decrease costs. And that oftentimes leads to less than ideal outcomes for the people that that business is serving. But again, similarly, public companies are beholden to their shareholders. So that's why people don't just, you know, give discounts out for free. Like these businesses are capitalistic industries. They are here to make money, not to help people. What are the impacts from private equity on everyday people? Tldr things might just get worse while also getting more expensive. PE touches life in so many weird ways. I mean Blackstone just bought Jersey Mike's sandwich shop. I mean, who has been to a Jersey Mike's? I don't know. I haven't. Silver Lake is buying ea, the video game maker. Pew Pew. Like you know, video games. And Pamyra took Squarespace, a formerly public company, private so Bill, the next time you want a hoagie or you want to play a video game with your friends or even just make a new website for your small business, just know that PE probably raised the price and somehow cut some corners on the back end. How can companies with shareholders stop a PE takeover? The brutal honest truth here is it's pretty hard to stop a PE takeover, especially at public companies. While upper level management may hate the idea of a PE buyout, it may just not even matter because once you become a public company, I mentioned this earlier. Your board has a fiduciary responsibility, meaning they're financially obligated to do what is in the best interest of shareholders. So if a PE company comes in with a sweetheart offer to buy the company at a value much higher than what that company is currently publicly trading at, the board has little to no choice but to consider it and potentially sell the company. That's why there's been so many fights in the tech world when management C suite execs still own a significant portion of the company and have differing views from the public shareholders. So so, for example, at Meta, Mark Zuckerberg still owns a lot of shares, and he may have a different vision of what is best versus regular people who hold Meta stock. For example, he went and spent billions of dollars on AI and virtual reality, and not all of the shareholders were probably happy with that. Okay, next question. And I'm reading this verbatim Better alternatives that serve all populations More equitable funding options so I'm not sure if this is a question or rather a statement, but yes, I agree. A better alternative that is more equitable and serves all populations is a wonderful ide in theory. But why would investors want that versus the option that does whatever it takes to make them money? Sure, there are some impact investing funds that are trying to do good while also doing well, but overall, I truly believe this. There is no such thing as conscious consumerism under capitalism. People are out here to make money, and until we can get people to value something else more than money, which is maybe helping our environment, not investing in tobacco and arms and vice, it's going to take a while for people to really prioritize other things. And until we can do that, people are always going to prioritize whatever investment makes them the most money, whether or not it then ends up hurting the communities that these businesses operate in. It's unfortunate. Next question. How exactly are PE funds able to financially in brackets taxes differentiate themselves from corpse. So the gains that are generated for investors and through carrying are taxed like any other investment gain. But I think it's important to call out that this is at a much lower level than ordinary income taxes on labor. And that's probably what you're thinking of. When you go to your day job, you are doing labor. You are either typing in a keyboard, doing physical work, maybe you're a doctor, whatever that gets taxed at the federal ordinary income marginal rate that goes all the way up to percentages in the high 30%. However, when it comes to capital gains taxes, the maximum is 15%. That is why oftentimes there are Conversations with politicians who want to reconsider how Kerry is taxed. Because it feels like all of these people who are typically working in an industry like this or investing in an industry like this are the people who least need a tax break, but they're getting one because it's considered investing and not labor. Okay, next question. How much percent of my investment budget would you recommend go to private equity? I think this is a really great question and it's kind of hard to answer without knowing your whole financial picture. But this is what I always say. Private equity is like the top of the food pyramid, where it's like the candy and the chips. Whereas other things in your investment portfolio should probably be a little bit lower. Like if you are not invested in the public equity market. So like the stock market, if you do not have an emergency fund, if you are a little bit older and don't have some fixed income assets like bonds, private equity may not be the first thing I would go to. Private equity I would say is a riskier investment with potential for higher reward. But it's something that you need to balance in your triangle, your portfolio. So I would just say it really depends on how much money otherwise you have invested. I would say at a high end you could have half of your portfolio be private equity, but I would want to see you having millions already invested in other ways. But on a low end you could start, you know, simply if private equity becomes available option to you in your 401k plan, it could be 5% or 10%. Just something to, you know, dip your toe in. All right, next question. Is private equity ever good for all stakeholders? If not, why is it legal? Well, technically private equity is currently good for all stakeholders, AKA people with money or a vested interests. But that doesn't mean it's better for consumers. That's just the way business goes. Unfortunately, the people in power at these companies are making deals with these private equity firms and we're kind of just along for the ride. The gps are feeling good because they've made money by doing the hard work. The LPs feel good because they've made money investing. And frankly, more often than not, the high level execs who have a big stake in those companies are getting payouts when they get bought out. So everybody who has a vested interest a stake is doing well. The problem is, is Joe Schmo who goes to this pet, this like pet care vet or Nancy who lives next door and goes to this one specific shop like they don't own any part of those things and thus they are not considered in the equation of like, what is better. Which I also think, you know, is, is a commentary on how important it is to own, own a stake in businesses that you are patroning and believe in. The next question, how does it differ from public equity? So simply put, this is just the stock market versus private companies. With public equity, anybody who has the money can go out onto the stock market and just log into a brokerage account and like buy shares of something, right? Like if I wanted to right now, I could log in, I could go buy a couple shares of Apple and I would be a part time, a part owner in Apple. But I can't go and say, hey, I, I want a piece of that hospital over there unless it's part of a, you know, a publicly traded brand. But like, private companies are private equity and public companies that anybody has access to is public equity, AKA the stock market to wrap us up. Private equity isn't some mystical financial wizardry that only affects billionaires. It's literally everywhere in your daily life. From your morning coffee run to your evening scroll through your apps. Understanding how PE works gives you superpowers as both a consumer and an investor. Because now you can spot the patterns where when your favorite brand suddenly changes its menu or your local gym gets upgraded with higher prices, you might be seeing PE optimizations in action. Here's my real talk verdict on private equity. It's neither the savior nor the villain that people make it out to be. It's a tool. And like any tool, it can be used to build something amazing or to tear something down. The key is understanding that PE firms are businesses with one primary goal. Making money for their investors. Sometimes that aligns with creating jobs and improving companies, and sometimes it doesn't. Being aware of this helps you make smarter choices with your wa and your career. Whether or not you want to support this industry. For most of you listening, private equity shouldn't be a major part of your investment strategy right now. If you're not maxing out your 401k, building an emergency fund and investing in low cost index funds, PE is putting the cart before the horse. But as your wealth grows, understanding PE gives you options and helps you evaluate opportunities that might come your way. So the biggest lesson here, knowledge is power. Especially in the world of finance. The more you understand about how money moves through the economy, the the better decisions you can make with your own money. Private equity might seem like this exclusive club for the ultra wealthy, but the principles buying undervalued assets, improving them and selling for a profit are actually strategies you can apply at any wealth level and frankly even to your day to day life. So keep asking questions, keep learning, and remember that building wealth isn't just about picking the right investments, it's about understanding the system well enough to navigate it successfully. Catch you next week thanks for tuning into this week's episode of Net Worth and Chill, part of the Vox Media Podcast network. If you liked the episode, make sure to leave a rating and review and subscribe so you never miss an episode. Got a burning financial question that you want covered in a future episode? Write to us via podcastourrichbff.com follow Net Worth and Chillpod on Instagram to stay up to date on all podcast related news and you can follow me at yourrich BFF for even more financial know how. See you next week. Bye. Thanks to Bumble for their support of the show. With Bumble, you get a glimpse into someone's personality, interests and lifestyle right on their profile. Their prompts make it easy to see if you're compatible right away. 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