As head of public affairs with the investment firm KKR, Ken Mehlman is on a mission to bring the benefits of private equity into the spotlight. By being able to take risks that other types of capital providers wouldn’t, Mehlman says, private equity can benefit the American economy in an impactful and unique way. He stresses that investing now cannot take place unless a firm can commit to also looking at a company’s social and environmental issues that affect local communities.
Private equity is a term used when investments are made in a business that is not generated from the public markets. This includes venture capitalists or angel investors, which get most of their attention for funding promising start-up companies. Meanwhile, other small or private businesses need access to capital as well, which is where private equity comes into play.
The challenge for Ken Mehlman and firms like KKR stems from the recent presidential election, where stories about Mitt Romney’s former private equity firm, Bain Capital, was painted as a shadowy giant that cannibalized businesses and ruined jobs. It doesn’t help that most professionals in private equity have a reputation for keeping quiet about what private equity is, what they do and how they do it.
Since 2006, Ken Mehlman and his team of support at the Private Equity Growth Capital Council have been working to change private equity’s reputation and speak out about the good things private equity beings to the economy. Since then, the council has produced statistics, reports and videos to educate the public about how private equity works and how it helps things like pension funds.
While private equity firms would have probably preferred to stay in the sidelines, the silver lining in the scrutiny that came from the 2012 campaigns is that private equity may now have a better reputation that before, since Mehlman and the council’s CEO Steve Judge and communications officer Ken Spain have been able to execute a positive vision for the industry.