Psychiatry is not low hanging fruit for PE like ER docs, urology, etc. there is a big undersupply of prescribers in the USA (psychiatrists, nurse practitioners) and health plans have trouble getting enough psychiatrists on their panels. it looks like they are going for critical mass in some states. the best way for PE to make money in psychiatry is restrict prescribers to med management (mainly 15 minute appointments) and to get counselors to provide therapy, which is not always in the best interest of patients. my point being that there aren't a lot of operational efficiencies in psychiatric practice; there are some clinical practice approaches (restrict prescribers to med mgt, use low cost counselors, etc) that could increase revenues. so it looks like TPG is going to be in the business of practicing medicine or at least developing best practices for its employees. Not good.
Good post, Matt. Further to the banking software point, part of the reason the archaic legacy software remains is the time and cost factor associated with migrating to a new solution. And the reason it is such a gargantuan undertaking is mergers and consolidations that have made the big banks almost monopoly like. Smaller banks and credit unions are more nimble and better able to migrate to new systems, while the big guys are left with the old DOS based systems and myriad departmental piecemeal workarounds.
Google may have another angle for the Financial AI thingy, while the product is free currently the cloud infrastructure that runs is is likely not and this is probably an aim at increasing usage of their cloud computing resources.
You talk a lot about how Amazon has a retail monopoly but they offer cloud computing resources that a significant percentage of the internet runs on. Google's cloud is currently #3 behind Amazon and Microsoft and they are desperately playing catch up. Considering the legacy nature of most banks IT systems it means that any financial institution that can be lured into using the Google cloud is likely to be a large customer for a long time.
For an eerily prescient discussion on monopoly and capitalism, just read Lenin’s “Imperialism, the highest stage of capitalism”. It’s stunning in how much it applies to our world, with Internet moguls instead of coal and steel ones. And it shows well enough how it could end really bad...
Curious finance noob here, how big is Roarke's investment in Cheesecake Factory?
RB says: "The deal provides Roark with 200,000 preferred shares in Cheesecake... The conditions state that Roark can start converting its preferred stock to common shares at a rate of $22.23 per share, up to a stake equal to 19.9% of total common shares outstanding. "
Psychiatry is not low hanging fruit for PE like ER docs, urology, etc. there is a big undersupply of prescribers in the USA (psychiatrists, nurse practitioners) and health plans have trouble getting enough psychiatrists on their panels. it looks like they are going for critical mass in some states. the best way for PE to make money in psychiatry is restrict prescribers to med management (mainly 15 minute appointments) and to get counselors to provide therapy, which is not always in the best interest of patients. my point being that there aren't a lot of operational efficiencies in psychiatric practice; there are some clinical practice approaches (restrict prescribers to med mgt, use low cost counselors, etc) that could increase revenues. so it looks like TPG is going to be in the business of practicing medicine or at least developing best practices for its employees. Not good.
Good post, Matt. Further to the banking software point, part of the reason the archaic legacy software remains is the time and cost factor associated with migrating to a new solution. And the reason it is such a gargantuan undertaking is mergers and consolidations that have made the big banks almost monopoly like. Smaller banks and credit unions are more nimble and better able to migrate to new systems, while the big guys are left with the old DOS based systems and myriad departmental piecemeal workarounds.
Google may have another angle for the Financial AI thingy, while the product is free currently the cloud infrastructure that runs is is likely not and this is probably an aim at increasing usage of their cloud computing resources.
You talk a lot about how Amazon has a retail monopoly but they offer cloud computing resources that a significant percentage of the internet runs on. Google's cloud is currently #3 behind Amazon and Microsoft and they are desperately playing catch up. Considering the legacy nature of most banks IT systems it means that any financial institution that can be lured into using the Google cloud is likely to be a large customer for a long time.
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For an eerily prescient discussion on monopoly and capitalism, just read Lenin’s “Imperialism, the highest stage of capitalism”. It’s stunning in how much it applies to our world, with Internet moguls instead of coal and steel ones. And it shows well enough how it could end really bad...
Curious finance noob here, how big is Roarke's investment in Cheesecake Factory?
RB says: "The deal provides Roark with 200,000 preferred shares in Cheesecake... The conditions state that Roark can start converting its preferred stock to common shares at a rate of $22.23 per share, up to a stake equal to 19.9% of total common shares outstanding. "