The issue is that a company purchased by PE often has built up a positive image of their brand. Sea World probably has thousands of positive reviews online; by the time the online consensus catches up to the reality of the experience, it's very easy to be fooled. That's where the money is made: when costs are cut but the brand still has a positive perception.
PE doesn't have to change their tune; by the time consumers realize that the product has changed, the firm has already made their money.
The difference is incentive structure. Running a business successfully is hard, and getting one to profitability is difficult. The easiest way to make money on a purchased business is to cut costs while people perceive it positively, ride that wave until the business isn't perceived positively, then sell the remaining assets. This method, given that it happens frequently, seems to be the easiest and most reliable way to turn a profit from a business over a period of 3-7 years, with no regard for the survival of that business moving forward.
Given that PE is generally looking for profits over the 3-7 year time period, this would line up with their goals.
Other businesses could absolutely have the same incentives. We see similar acquisitions from Google, Facebook, etc. where products are absorbed into the parent company or otherwise shut down. However, there's a larger chance that the purchasing business has incentives that align with the company being purchased. An established and trusted brand is incredibly valuable; many parent companies would be content to let that business thrive as a semi-autonomous business unit.
Would you argue that PE is less or more likely to employ the strategy I've outlined in my original comment? My prior would be that PE is more likely to use that strategy than other businesses.
As always, I'm open to my views being changed on that. Clearly not all PE deals involve stripping a company down, and plenty of other businesses would be happy to strip a company down. As someone with more experience with PE, I'd be interested in your views and why you have different priors than me.
> This method, given that it happens frequently, seems to be the easiest and most reliable way to turn a profit
I think you're naively looking at the headlines of PE that focus on large cap buyouts. For every story about Toys R' Us, there are hundreds of PE buyouts that do no cost cutting and use PE capital to grow their businesses.
As I noted earlier, the big PE funds - Apollo, KKR, etc. - are notorious for stripping away large healthy brands and financially engineering them to leave them loaded up with debt. I can certainly appreciate why people think the whole industry is like this. For the record - not only do not I have access to these funds, I would politely decline working with them if I had the chance (we actually said no to biz with one of the big firms years ago). They easiest PE route is in fact investing in healthy businesses with good management teams and then selling them in 3~5 years when multiples naturally go up. The less work that is required to turn the business around the easier it is on the PE fund. Financial engineering and cost cutting is just a cheap trick that can only be used in certain situations.
There is a HUGE market of mid market PE firms that survive on growing both top line and earnings as a result of growth orientated initiatives, and don't leave the company hanging with swathes of debt. In fact, there is a category called Growth PE which has invested in many of the tech companies we discussed here. Look up Insight Venture Partners, TCV, Tiger Global, etc.
PE doesn't have to change their tune; by the time consumers realize that the product has changed, the firm has already made their money.