Why would that be the hypothetical? The people that made Joann are the ones who decided to make it a publicly listed business, all the way back in 1969.

https://www.cleveland.com/pdextra/2010/12/the_history_of_jo-...

notcancer stated:

>Call me old-fashioned, but maybe craft stores don't need infinite double-digit growth.

Craft stores don't need double digit growth (returns is more accurate than growth), but Joann did because Joann's owners decided they wanted to try to expand their business, and probably their own wealth, and so they tapped the public equity markets.

People seem to be upset that business owners desire to bet for bigger returns, but isn't that the business owners' right? A lot of times, it doesn't work out, or it eventually doesn't work out. But what is the alternative?

As a reminder, the question was “why does a craft store need double-digit growth?” And the answer is “it doesn’t, until the owners make a big enough bet that it’s unrecoverable if they fail”.

In Joann's case, they were competing with Michaels and Hobby Lobby, nor were they that differentiated from Michaels.

State ownership of business or heavy restrictions on the ability of owners to sell, dissolve, for take risks with business they own.

I don't agree, but that seems like the clear alternative.

Some people might propose preventing debt backed private equity firms from defrauding investors, but those laws are already on the books. The banks that fund buyouts and sometimes get left holding the bag absolutely know the risks and have well funded legal teams capable of protecting them.

Consumers don't get a say because they are not actual equity owners things like securing access to yarn or all you can eat shrimp do not supersede property rights in the view of the government.

> State ownership of business

Until they either collapse (LGFVs in China) or severely degrade in user quality (Air India), and it's the taxpayers on the hook.

> heavy restrictions on the ability of owners to sell, dissolve, for take risks with business they own

Then there's no incentive to start or scale a business, for example why business incorporation in Switzerland is preferred over France despite similar/same culture, but easier ability to incorporate, sell, or shut down businesses

> Consumers don't get a say because they are not actual equity owners things like securing access to yarn or all you can eat shrimp do not supersede property rights in the view of the government

I can still go to Michael's, Hobby Lobby, or my local crafts shop to buy the same products.

This should be clear from my post, but you are preaching to the choir. In my opinion, if someone wants to gut their business, that is their choice. If someone doesn't like the options, they should start a competitor.

basing a system on the idea that consumers shouldn't have to shop or businesses can never fail leads to all sorts perverse outcomes.

I fundamentally agree that companies don't need to grow. They do however need to have returns.

Companies need returns to justify their continued existence to owners.

Growth comes into the picture because if someone thinks growth is possible, they are willing to pay more for it then an owner thinks it's worth.

This is an extremely common PE situation, where a management firm and Banks think more profit could be generated then the current owner. Then they offer more money than the owner thinks it's worth and try their luck. Sometimes it works out, and sometimes it doesn't.

The other common case is when PE act a buyer of last resort. If someone doesn't want to run a business anymore, they look for a buyer.