Why a critical takedown of the private equity sector is essential reading
A review of The Asset Class by Hettie O'Brien
Hello Rainmakers,
A few summer reading recommendations for you.
The public view of private equity is important. Maybe not as important as the performance of portfolio companies, or the returns to funds, or an ability to raise capital in the future, but it is important nonetheless.
With a background as a journalist at the left-leaning magazine New Statesman, and the Guardian, Hettie O’Brien’s study of private equity in her new book The Asset Class, isn’t destined to be sympathetic.
The subtitle of the book makes that clear - ‘How private equity turned capitalism against itself’.
Rainmakers subscribers get two unique pieces a week, but also full access to our back catalogue of investigations, scoops, and insights, including talking points within the, like this one, insights from The Secret Investor, interviews with entrepreneurs, and the leaders from other VC and PE investors like Endless, BGF and WestBridge.
The core message running through The Asset Class should be heeded. It is a sector gaining in importance, but most members of the public are unlikely to know the names of the people and brands behind the companies they work for, the houses they rent. Not to mention hospitals, nurseries and care homes.
For decades, private equity firms have gained greater influence and reach. UK Private Capital’s own figures reports that private capital firms have invested nearly £25bn into over 1,400 UK businesses in 2025 alone.
How politicians might then make decisions about how to curb the worst excesses of the sector becomes fairly urgent.
We’ve covered the charm offensive on the incoming Labour government in some detail. And public affairs specialists from UK Private Capital have made their cases on various stages, including those we’ve built around this brand, Rainmakers.
To be fair, O’Brien stops short of the wilder accusations of what some of the above were up, and doesn’t overplay her hand in pinning those kind of crimes on private equity. What The Asset Class does do very effectively is chart the emergence of a hidden empire of billion-dollar deals and what she calls “covert financial warfare”.
The examples she picks on - housing and property in Copenhagen to tech investments in San Francisco, and the scandal of the UK water industry in the Yorkshire Dales - all follow the money, the ideological roots and the trail of destruction.
She identifies some of the founding fathers of modern private equity in the shape of William E Simon, President Richard Nixon’s former Treasury secretary, and his early zeal for using hefty debt to re-energise and motivate underperforming companies.
On this side of the Atlantic she fingers the role played by James Goldsmith and Jim Slater, who represented a challenge to the sleepy City of London with their own buccaneering corporate raider style.
The explanation of the use of debt to fund a purchase of an industrial asset is well explained, and the explanation of how this played out in the UK care home sector are distressing and uncomfortable.
The explanations of the fund raising and fee structure is illuminating and it’s either a comment on how opaque the methods of private equity are that much of it was new to me.
