My own interest in the subject of Private Equity came with the shocking realization that some businesses grow simply because they know where to get money—not because they have a better strategy, more motivated staff, or leaner business processes. It comes down to knowing how and where to get the smart cash.

My parents did a most extraordinary thing in their mid-fifties; they started up a business in typesetting, a field they knew nothing about. Even more astonishing, they kept it going for 15 years, making a nice living. They did a lot of things well and had an ambitious vision to deal with changing technology and where they wanted to go. They lacked in one area—understanding money. They failed to understand that there were different ways to finance their enterprise and that many investors would have given their eye teeth to partner with them. They had the most attractive type of business too as it had expensive machinery—a creditor’s dream as these can be sold to recoup the money.

The bank recognized a good thing. It offered heaping helpings of money, along with grave repayment schedules. But it brought almost nothing else to the table. Despite their inexperience, my parents wanted to take their business beyond supporting their lifestyle and they could have if they’d had more financial muscle and insight in the boardroom.