With credit markets constrained and a shift away from a business culture built on highly leveraged portfolios, it may seem hard to be optimistic about the future of private-equity firms. But private equity’s past success hasn’t resulted solely from leverage but rather from its culture of active ownership, its adaptability, and its ability to summon financial and human resources. In today’s difficult economic environment, those strengths are more important than ever.
Full-text article by Conor Kehoe and Robert N. Palter is available via The McKinsey Quarterly, April 2009. [Subscription required.]