When my parents and I immigrated to the USA in the late 1980s, Michael Milken was driving innovation in finance by expanding access to credit, employing high yield bonds. I was fascinated by the role of finance in society, and decided to pursue my undergraduate studies in Finance. Luckily my limited command of the English language at that time prevented me from entering the brokerage industry, and I benefited from growing up in Corporate Finance. At Delta Air Lines I climbed the ranks working on operating and capital budgets, long term planning, investor reports, executive compensation models and board of directors presentations. The experience gave me a hands-on practical view of corporate governance.
As Delta was hemorrhaging cash, the company retained Blackstone to help with its debt exchange in a failed attempt to avoid bankruptcy. Working as the Delta liaison with Blackstone, I came to understand the role of corporate governance on the road to bankruptcy, and the role of PE in helping such companies.
During my MBA I attended all the private equity conferences and PE/VC events, absorbing as much as I possibly could about the industry. As I was sitting through a panel discussion on the challenges of the relationship between Limited Partners and General Partners, it occurred to me that the shortened holding period of any equity in a modern portfolio was a manifestation of the transaction-focused nature of the financial system. It was that focus driving the questions Wall Street analysts asked quarter after quarter. The spill over of that focus had impact on management attention. When the lack of long term planning in conjunction with some exogenous event, derailed a company, special measures, (e.g. PE involvement) were necessary to remedy the situation.
From that point on I shifted my focus from understanding the PE industry to understanding the broader financial system. Restructuring of the financial system for our time became my passion.