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Accretive

Making the numbers look better by destroying something real. “This acquisition is accretive to earnings” means “We fired everyone and called it profit.”

Activist Investor

Someone who buys 5% of your company and demands you fire people, sell assets, and distribute cash. Activists never suggest building anything. Only extracting.

Addressing Legacy Liabilities

Private equity term for raiding pension funds and canceling promises made to employees.

"We’re addressing legacy liabilities" means "We’re stealing retirement money from workers who spent decades building this company."

The liabilities aren’t legacy problems to fix.

They’re obligations to honor.

Pensions were promised compensation.

Healthcare was earned through years of service.

Severance was contractual protection.

When private equity "addresses" these "liabilities," workers who were promised security get betrayed.

Safeway workers lost $1.3 billion from their pension fund when Cerberus Capital "addressed legacy liabilities."

Delphi Automotive workers lost pensions entirely when Elliott Management "addressed" them.

Hostess Brands Inc. workers lost their pensions when Ripplewood Holdings "addressed" them in 2004, then the company died in 2012 while Twinkies survived.

The companies didn’t fail.

The promises were broken.

Governments remain silent.

Laws don’t prevent it.

News barely covers it.

"Addressing legacy liabilities" is extraction code for "breaking commitments to workers who can’t fight back."

Advisor

Someone who gets paid to tell companies to fire people. Advisors don’t have to live with the consequences. The companies do.

Alignment

Making sure everyone loses money except the people who control the structure. “Our interests are aligned” means “You take the risk, I take the fees.”

Alpha

Returns that come from being early, lucky, or lying. venture capitalists claim they generate alpha. Math says they generate fees.

Arbitrage

Finding a price difference and exploiting it before it disappears. Or in extraction terms: finding someone who doesn’t know they’re getting screwed.

Asset Class

When something that used to be for using becomes something for extracting. Housing was shelter. Now it’s an “asset class.” Means institutional investors buy it, price out families, extract rent forever. Turns necessities into investment vehicles. Turns users into renters.

Asset-light

Owning nothing. Controlling everything. Making money from other people’s assets. Like Uber. Or Airbnb. Or any platform that calls workers “partners” instead of employees.

Asset Stripping

Buying a company. Selling everything valuable. Leaving a carcass. Legal when private equity does it. Called “theft” when individuals do it.

Asymmetric Upside

Venture capital term meaning "we win big if it works, you lose everything if it doesn’t."

The pitch sounds sophisticated: "We’re seeking asymmetric risk-reward profiles where upside potential significantly exceeds downside exposure."

Translation: "We’re making bets where we collect fees regardless of outcome, but if something works, we capture most of the gains."

Here’s how asymmetric upside actually works in venture capital:

Invest $10 million for 30% of company.

If company fails: venture capital loses $10 million but already collected $2 million in management fees across the fund.

Net loss: $8 million spread across Limited Partners.

If company succeeds and exits at $1 billion: venture capital’s stake worth $300 million.

venture capital collects 20% carry on the gain = $58 million personally.

Plus the $2 million in fees already collected.

The asymmetry isn’t risk-reward.

It’s who-bears-what.

Venture capitalists get upside (carry on wins).

Limited Partners get downside (losses on failures).

Founders get neither (diluted to nothing or fired).

The term makes it sound like smart investing.

It’s actually just: "Heads I win big, tails you lose everything, and I collect fees either way."

Real asymmetric upside would be: risk little, gain much.

venture capital asymmetric upside is: risk other people’s money, gain personally, lose nothing.

When venture capitalists say "asymmetric upside," they mean: "The asymmetry benefits me, not you."

Basis Points

Fees measured in tiny increments so they sound smaller. “We only charge 200 basis points” means “We take 2% of your money. Every year. Forever. Whether we perform or not.”

Best Practices

Whatever McKinsey told your competitor to do. Usually involves firing people and calling it efficiency.

Benefit Fee

The $1.50 "Regulatory Response Fee" or "Driver Benefits Fee" on delivery app orders.

The wording makes customers think they’re helping drivers.

"Oh good, my extra dollar goes to driver benefits."

Actually: it goes straight to corporate lobbying against driver protections.

Internal documents from delivery apps show a specific cost center called "Policy Defense."

That fee feeds directly into it.

Customers pay for the lawyers fighting to keep drivers uninsured, unprotected, and earning below minimum wage.

After labor laws passed requiring basic protections, apps added the fee.

Named it "benefit" to sound helpful.

Used the money to fund lobbying against those exact benefits.

The $1.50 doesn’t go to drivers.

It goes to attorneys arguing drivers aren’t employees.

It funds campaigns against unionization.

It pays for astroturf groups with names like "Drivers for Freedom" that oppose driver rights.

You order dinner.

Pay an extra "benefit fee."

Think you’re helping your driver.

Actually funding the legal team fighting to keep that driver homeless.

Extraction doesn’t just take from workers.

It makes customers pay to oppress them.

Then makes customers feel good about it.

Blockchain

A distributed database that’s slower, more expensive, and less useful than regular databases. But sounds futuristic. Perfect for raising money from people who don’t ask questions.

Blitzscaling

Reid Hoffman’s term for growing so fast that everything breaks.

The pitch: "Move faster than competitors, achieve monopoly, win the market."

The reality: "Burn billions on subsidized growth, destroy all competitors with capital instead of products, then extract forever from the rubble."

Hoffman wrote a whole book about it.

LinkedIn co-founder turned venture capital philosopher teaching founders how to destroy sustainably.

The strategy:

Ignore unit economics.

Ignore profitability.

Ignore whether the business model works.

Just grow.

Raise money.

Grow faster.

Raise more money.

Outspend competitors until they die.

Then raise prices and extract.

Uber blitzscaled. Lost $31 billion. Destroyed thousands of taxi businesses.

Now rides cost more and drivers make less than before.

WeWork blitzscaled. Burned $12 billion on "community-adjusted EBITDA."

Filed for bankruptcy.

DoorDash blitzscaled. Loses money on every order despite taking 30% from restaurants.

The pattern: Blitzscaling isn’t building faster. It’s destroying faster.

It’s not innovation. It’s predatory pricing funded by venture capital.

Use investor money to subsidize prices below cost.

Competitors can’t match it.

They die.

Once they’re dead, jack up prices and extract.

The customers have no alternatives left.

The bridge is burned behind them.

Hoffman calls this "offensive strategy."

Translation: "Weaponize capital to destroy competition, not build better products."

Real builders improve quality, lower costs through innovation, earn customers through value.

Blitzscalers ignore quality, burn cash to subsidize losses, capture customers through capital.

When venture capitalists say "you need to blitzscale," they mean: "Grow so fast you can’t build sustainably, become so dependent on our money you can’t refuse our terms, and destroy the market so thoroughly that only extraction remains."

Building Back Better

Post-crisis slogan meaning “extraction back better.” When the World Economic Forum says “build back better” after COVID, they mean: billionaire wealth increased 54% during lockdowns while small businesses went bankrupt. Building back whose wealth? Theirs. Who pays? Everyone else.

Bulge Bracket

The biggest investment banks. Goldman Sachs. Morgan Stanley. JPMorgan Chase. Called “bulge bracket” because their names literally bulged out on the old printed league tables showing deal rankings. Wall Street loves jargon that makes things sound impressive. “I work at a bulge bracket bank” sounds better than “I work at Goldman Sachs advising companies on layoffs.”

Burn Rate

How fast a company spends money it doesn’t have. venture capitalists love high burn rates. It makes companies desperate. Desperate companies accept terrible terms.

Can’t Make an Omelette Without Breaking a Few Eggs

What extractors say when the "eggs" are people’s livelihoods and the "omelette" is their quarterly bonus.

"You can’t make an omelette without breaking a few eggs" means "We’re destroying lives and communities but it’s necessary for progress."

The people saying this are never the eggs.

They’re always the ones eating the omelette.

When mass layoffs hit, executives quote this phrase and call it pragmatism.

When plants close and towns die, consultants cite this metaphor and call it economics.

But extraction isn’t cooking.

The eggs don’t become something better.

They just break.

The omelette goes to extractors.

The shells go to workers.

And calling destruction "necessary" doesn’t make it true.

It just makes it easier to justify.

Capital Efficiency

Firing people. “We’re focused on capital efficiency” means “We hired too many people last year and now we’re fixing it.”

Carbon Credits

Permission slips to pollute. Companies buy credits from marketplaces run by financial firms. Poor countries get paid to not develop. Rich countries pay to keep polluting. Financial intermediaries extract fees on every transaction. The planet burns anyway. But the World Economic Forum calls it “climate action.”

**Carry** (Carried Interest): The 20% of profits that general partners extract from limited partners. Taxed as capital gains, not income. Because extractors write the tax code.

Cash Flow

Money coming in minus money going out.

Real businesses care about cash flow because it keeps the lights on.

Extraction economy obsesses over cash flow because it’s what you extract.

"Passive cash flow" means money extracted without working.

"Positive cash flow" means extracting more than you’re spending.

Every guru sells courses on cash flow.

Every podcast preaches cash flow.

Nobody talks about where the cash flows from.

Because it flows from workers who create value to extractors who capture it.

Real builders generate cash flow by solving problems.

Extractors generate cash flow by owning things other people built.

The term became extraction shorthand for "money I get without creating value."

When someone brags about their "cash flow," the question is where it comes from.

Usually: rent (extracting from tenants), dividends (extracting from companies), fees (extracting from clients), or interest (extracting from borrowers).

Cash flow is neutral.

What matters is whether you earned it or extracted it.

Consolidation

Buying all the competitors. Raising prices. Calling it economies of scale. Customers call it monopoly.

Core Business

The part we’re keeping. Everything else gets sold or shut down. Usually decided by consultants who don’t understand what the business does.

Cost Center

Employees who don’t directly generate revenue. Like HR. Or legal. Or the people who keep the building from collapsing. Always first to be eliminated in “restructuring.”

Cost Optimization

Consultant-speak for cutting everything until the business barely functions. “We’re implementing cost optimization strategies” means “We’re firing experienced workers, eliminating training, reducing quality, and calling it efficiency.” Circuit City “optimized costs” by firing all experienced salespeople and replacing them with minimum wage workers. Customers stopped coming. Company went bankrupt. The consultants kept their fees. See also: Labor Arbitrage, Margin Improvement.

Covenant-lite

Loans with no rules. Borrowers can do anything. Lenders have no protection. Works great until it doesn’t. Then lenders lose everything. But they already collected their fees.

Crypto

See “Blockchain” but add: pump-and-dump scheme disguised as revolution.

Data-driven Decision

Firing people based on spreadsheets instead of judgment. Sounds scientific. Actually just cowardice with formulas.

Desperation Score

Hidden metric delivery apps use to track how desperate drivers are for money.

Based on acceptance behavior.

The algorithm watches:

How quickly drivers accept low-paying orders.

How often they work during unprofitable hours.

Whether they’ll take deliveries other drivers rejected.

The more desperate the driver, the lower the pay offered.

Single parents who need to make rent by Friday get worse offers than hobbyists earning side cash.

Immigrants sending money home get squeezed harder than college students.

Drivers in financial crisis accept anything.

The algorithm knows this.

And exploits it.

Not speculation—internal documents from former delivery app employees confirm this exists.

"The thing that actually makes me sick is the Desperation Score. We have a hidden metric that tracks how desperate they are for cash based on their acceptance behavior."

Translation: The algorithm measures human suffering and uses it to minimize compensation.

The more you need the money, the less they pay you.

That’s not a bug.

That’s the feature.

Extraction economics perfected: weaponize desperation, automate predation, call it optimization.

See also: Human Assets, Benefit Fee.

Downcoding

Medical billing fraud dressed as coding accuracy.

When insurance companies pay hospitals based on diagnosis codes, hospitals hire "coding optimization consultants" to downgrade diagnoses to cheaper treatments.

Patient came in with heart attack? Code it as chest pain.

Stroke? Code it as dizziness.

Cancer treatment? Code it as observation.

The medical care doesn’t change.

The billing code does.

Result: insurance pays less, hospital extracts from patient directly, consultants collect fees for teaching fraud.

McKinsey pioneered this for hospital systems.

Called it "revenue cycle optimization."

Translation: "Teach doctors to lie on insurance forms so hospitals can balance-bill patients."

UnitedHealth does it systematically through its Optum division—owns the insurance company AND the coding consultants.

Codes everything down.

Denies everything possible.

Extracts from both sides.

The patient gets surprise bills.

The hospital blames insurance.

The insurance blames hospitals.

McKinsey and Optum collect fees from everyone.

When medical billers say "we’re implementing coding accuracy initiatives," they mean: "We’re downcoding everything we can get away with."

The codes exist to describe medical reality.

Downcoding uses them to extract from the sick.

Downward Reset

Corporate euphemism for cutting compensation, benefits, or expectations.

Sounds technical.

Like adjusting a thermostat.

Actually means: "We’re paying you less and calling it an adjustment."

Common uses:

Salary downward reset = pay cuts.

Benefits downward reset = worse healthcare, less PTO, fewer perks.

Expectations downward reset = lower quality, reduced service.

Valuation downward reset = marking down company value before a down round.

The term is designed to sound inevitable.

Like a computer resetting to factory settings.

Neutral.

Technical.

Necessary.

"We need to reset compensation downward to market rates."

Translation: "We’re cutting your pay but making it sound like mathematics."

"We’re implementing a benefits downward reset to remain competitive."

Translation: "We’re eliminating your healthcare but using corporate-speak so you won’t get angry."

Real resets restore functionality.

Downward resets extract value and call it optimization.

The direction matters.

Downward always means less for workers.

More for extractors.

When consultants recommend a "downward reset," they mean: reduce what you give employees, keep what you take from customers, extract the difference.

Debt-loading

Taking a company that’s already paid in full and adding a mortgage to it.

The private equity playbook: buy a company with 10% equity and 90% borrowed money, make the company responsible for paying back the debt it didn’t borrow, extract fees while the debt crushes operations.

Like buying a house that’s mortgage-free, taking out a new mortgage on it, making the house pay the mortgage, then charging the house rent for existing.

The company that was healthy becomes terminal.

The debt isn’t meant to be paid back.

It’s meant to justify everything that comes next: asset sales, fee extraction, dividend recapitalizations, eventual bankruptcy.

Debt-loading is legal.

It’s documented in SEC filings.

It’s taught in business schools as "financial engineering."

But strip away the jargon and it’s simple: destroy a healthy company by forcing it to pay for its own acquisition.

Defensive Moat

Something competitors can’t copy. Extractors don’t build moats. They build walls. Then charge rent to cross.

Deleveraging

Paying down debt. Sounds responsible. Actually means: “We loaded this company with so much debt it’s about to collapse. Better extract what we can before bankruptcy.”

Democratizing

Taking something that worked fine and adding venture capital. “We’re democratizing real estate investment” means “We’re letting regular people fund housing extraction.”

Denominator Effect

When your portfolio shrinks and allocations get out of whack. Limited partners use this as an excuse to stop sending money to venture capitalists who lost it all.

Digital Identity

One ID for everything. Banking, healthcare, travel, voting. Sounds convenient until the reality becomes clear: every transaction tracked, every movement monitored, every dissent noted. The World Economic Forum promotes it. Tech companies (run by Young Global Leaders) build it. Governments (run by Young Global Leaders) enforce it. The inner circle completes. China already has it paired with social credit scores. Act up, money taken down.

Dilution

When your ownership percentage decreases. Founders experience dilution every funding round. By Series E they own 3% of something worth less than they started with.

Disruption

Losing money at scale until competitors die. Then raising prices above where they started. Uber “disrupted” taxis. Rides now cost more and drivers make less. That’s not disruption. That’s extraction with an app.

Distressed Debt

Buying loans from struggling companies for pennies on the dollar. Then forcing bankruptcy. Then buying the assets for nothing. Legal vulture capitalism.

Distressed Debt Funds

Vultures that feed on leveraged buyout casualties.

When LBOs fail, distressed debt funds buy the debt for 20 cents on the dollar.

Take control in bankruptcy.

Strip remaining assets.

Leave nothing.

Oaktree Capital manages $166 billion in distressed debt, feeding on LBO casualties.

Apollo Global started in Drexel Burnham Lambert’s ashes, now worth $500 billion, built on buying destruction.

The ecosystem requires LBOs to create corpses.

Distressed debt funds profit from the carnage.

They don’t cause the failure.

They just ensure nothing survives it.

When private equity loads a company with debt and it collapses, distressed debt funds buy the wreckage and extract what’s left.

The company dies twice.

First from the LBO.

Then from the vultures.

"Distressed debt investing" sounds like rescue.

It’s scavenging.

Down Round

When a company raises money at a lower valuation than before. Instant losses for recent investors. Happens when the previous valuation was fictional.

Dry Powder

Uninvested capital sitting in a fund. Sounds ready for action. Actually means the fund is so big it can’t find deals worth investing in. Or the deals available are so overpriced that even extractors won’t pay. $2+ trillion in dry powder globally means the extraction economy raised money it can’t deploy. Sit on it too long and LPs get angry. Deploy it badly and returns collapse. Either way, dry powder is a sign the pyramid scheme hit its limit.

Due Diligence

Reading the financial statements. Or in 2021 venture capital terms: “What’s due diligence?”

Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)

Fake earnings. Real earnings include interest and taxes. That’s why extractors prefer EBITDA. It makes bad businesses look profitable.

Economies of Scale

The theory that bigger companies are more efficient. In extraction terms: “We bought everyone, now we can raise prices.”

Efficient Market Hypothesis

Theory that stock prices reflect all available information and nobody can consistently beat the market. Created by Eugene Fama at University of Chicago. Used to justify: doing nothing (just buy index funds), paying executives in stock options (market knows best), and ignoring obvious bubbles (prices are always right). If markets are perfectly efficient, why do bubbles happen? Why did the market price Theranos at $9 billion? Why did crypto reach $3 trillion then crash 70%? The hypothesis works great in economics papers. Fails constantly in reality. But it gave extractors academic cover to claim markets are rational even while they manipulate them. “The market has spoken” means “Stop asking questions about obvious fraud.”

Efficiency Gains

Layoffs.

Efficiency Review

Process where consultants analyze your organization and identify “redundancies.” Translation: they figure out who to fire. Usually conducted by people who’ve never done your job. Always results in layoffs. Never improves actual efficiency.

Expense

What shareholder value theory calls employee training, development, and investment in people. “Training is an expense that hurts margins.” Translation: “Teaching workers new skills costs money this quarter. Fire them instead.” Under extraction logic, anything spent on humans who aren’t directly generating revenue today is waste. Never mind they might generate revenue tomorrow. The quarterly earnings call is in 90 days.

Exit Strategy

How investors plan to extract money from your company. Usually means: sell to a bigger fool or dump shares on the public.

Extraction

Taking value without creating value. The core philosophy of modern business. See: this entire book.

Fiduciary Duty

Legal obligation to act in someone’s best interest. Somehow interpreted to mean: “Maximize this quarter’s stock price by any means necessary.”

Financial Engineering

Making money by restructuring debt instead of building things. Real engineers build bridges. Financial engineers build collapses.

Fire Drill

McKinsey euphemism for destroying evidence. “It probably makes sense to have a fire drill on emails in preparation for future subpoenas.” Not an actual emergency evacuation. Code for: delete the incriminating documents before investigators arrive. The phrase appeared in internal McKinsey emails during the opioid crisis when they realized their “turbocharging” advice had created 700,000 deaths. Partners suggested a “fire drill” to purge emails showing they calculated the dollar value of overdoses ($14,810 per “event”). The cover-up was as optimized as the extraction. Even their document destruction had corporate jargon. When consultants say “fire drill,” they don’t mean practice evacuating the building. They mean eliminating evidence of what they advised inside it.

Financial Inclusion

World Economic Forum term for “inclusion in a system they control completely.” Central Bank Digital Currencies called “financial inclusion.” Means: everyone forced into trackable, programmable, freezable money. Can’t opt out. Can’t use cash. Included whether you want it or not.

Focus on Core Competencies

Firing everyone who isn’t directly making money today. Ignore that they might be building what makes money tomorrow.

Free Cash Flow

Money left after expenses. Extractors love free cash flow. Not to invest. To extract.

Founder-friendly

venture capital term meaning “We’ll screw you slightly less than other venture capitalists.” Still screwing you. Just with a smile.

Friedman Doctrine

Milton Friedman’s 1970 essay claiming "The Social Responsibility of Business Is to Increase Its Profits."

Not law.

Not legislation.

Just one economist’s opinion published in The New York Times Magazine.

But business schools taught it as gospel.

Wall Street repeated it as doctrine.

Lawyers cited it as precedent.

Over 50 years, opinion morphed into "law."

The doctrine claims corporate executives are employees of shareholders with one responsibility: making shareholders money.

Anything else is socialism.

Extractors weaponized it: "We’re legally required to maximize shareholder value."

Except the law never required it.

Friedman wrote what executives "should" do, not what they’re "legally required" to do.

He said conduct business "in accordance with their desires" — which could be anything.

Patagonia’s owners desired environmental protection.

In-N-Out desired quality over growth.

Costco desired paying workers above market rates.

All consistent with Friedman’s actual argument.

But extractors ignored that part.

They kept the "maximize profits" headline and discarded the nuance.

The Friedman Doctrine became the legal lie that justified every extraction.

Fire 10,000 workers? Friedman Doctrine.

Accept the buyout? Friedman Doctrine.

Cut R&D for quarterly earnings? Friedman Doctrine.

The most profitable lie ever told.

Not because it was true.

Because it sounded official enough that nobody questioned it.

Complete Dictionary: A to Z

This complete glossary is excerpted from From Extraction to Abundance by Markus Allen.

Every term. Every definition. Every uncomfortable truth about how Wall Street really works.

Download Free Book (EPUB)

Ghost Town

What extraction leaves behind. Main Street with empty storefronts. Factories that closed after private equity buyout. Towns where Walmart came, killed local retail, then left. The human cost of extraction measured in boarded windows and “For Lease” signs. Extractors call this “market forces.” The people who live there call it what happened after private equity arrived.

Golden Handcuffs

Compensation that traps you.

Two versions: founders and employees.

For founders:

When private equity buys a business, they offer a deal: sell for 5-8x revenue, stay on for 3-5 years as an employee, earn a retention bonus upon completing the term.

Sounds generous.

Actually: the cash from the sale gets taxed heavily and spent quickly.

The retention bonus is large enough the founder can’t walk away.

The non-compete clause prevents leaving.

The performance quotas make the job miserable.

Most realize the mistake within 6 months.

But the golden handcuffs are locked.

Can’t afford to quit (retention bonus too big to lose).

Can’t practice elsewhere (non-compete traps them geographically).

Can’t fix what’s being destroyed (private equity controls decisions).

So they stay.

Extracting from the community they built.

Watching quality collapse.

Implementing quotas they hate.

For employees:

At age 30, making $400,000 a year at McKinsey or Goldman or private equity, with mortgage, private school tuition, and lifestyle built around that income, taking a $150,000 pay cut to build something becomes impossible.

Not just financially.

Psychologically.

Their entire identity built on this career.

Their entire social network people who do the same thing.

Their entire skill set extraction skills.

They’re 35 years old.

They know how to model leveraged buyouts.

They can’t build a birdhouse.

The golden handcuffs locked when the money looked good.

By the time they realize extraction isn’t building, they can’t afford to leave.

The "golden" handcuffs feel like regular handcuffs.

Just more expensive to unlock.

Governance

Rules about who controls what. In extraction terms: “We own 20% but control 60% of the board and all major decisions.”

Great Reset

World Economic Forum book/initiative launched during COVID. Official pitch: “Use the crisis to reshape capitalism.” Translation: Use the pandemic to accelerate extraction. Billionaire wealth increased 54% during lockdowns. Small businesses closed permanently. The Summit called it “building back better.” They built their wealth back better.

Greenfield

Starting something new. Extractors hate greenfield. Building requires time and risk. They prefer buying something that works and destroying it.

Growth Equity

Late-stage venture capital funding. Also called: “We’re buying in at the peak and hoping for a greater fool.”

Growth Hacking

Spending investor money on customer acquisition at unsustainable rates. Then calling it innovation.

Hockey Stick Growth

Growth projections that look like a hockey stick. Flat for years, then sudden explosion upward. Never happens. But great for raising money.

Hold Period

How long private equity plans to own a company. Usually 3-5 years. Just long enough to extract everything valuable and dump it.

Human Capital

Employees. Calling them "capital" makes it easier to eliminate them. You don’t fire people. You "optimize capital allocation."

Human Assets

What delivery apps call their drivers.

Not employees.

Not contractors.

Not partners.

Assets.

DoorDash, Uber Eats, Instacart—they all use this internally.

"Human assets" can be deployed, optimized, reallocated.

They depreciate over time (burn out).

They can be replaced when efficiency drops.

They’re line items on spreadsheets tracking cost per delivery.

The term reveals everything.

Drivers aren’t people building careers.

They’re temporary resources to extract value from until a better asset (autonomous vehicles) replaces them.

When delivery apps say "scaling our human asset network," they mean: "recruiting more people we’ll pay minimum rates until robots work."

The language isn’t accidental.

It’s designed to dehumanize so extraction feels like optimization.

See also: Desperation Score, Benefit Fee.

Hurdle Rate

Minimum return required before general partners collect their 20% carry. Usually 8%. Sounds fair until the reality becomes clear: they collect 2% annual fees whether they clear the hurdle or not.

**Hutzpah** (also spelled chutzpah): Yiddish word meaning audacious nerve, shameless boldness. Wall Street appropriated it to describe the balls required for extraction without justification. “After Gekko, it just required hutzpah.” The irony: using a Jewish term to celebrate the kind of predatory capitalism that destroys communities.

Incentive Alignment

Structuring deals so everyone loses except the people who structured the deal.

Innovation

Anything new. Extractors love saying this word. Rarely doing it.

Institutional Knowledge

Everything employees know that isn’t written down. Usually lost during “restructuring.” Then rediscovered at great expense. Or never rediscovered and the company collapses.

Internal Rate of Return (IRR)

How venture capitalists measure returns. Highly gameable. Can be inflated by timing tricks and creative accounting. Perfect for making bad investments look good.

Initial Public Offering (IPO)

When a company sells shares to the public. Also when early investors and founders extract money from later investors who don’t know the business peaked.

Juicing

Making numbers look better through accounting tricks. “We juiced EBITDA by capitalizing operating expenses.” Translation: “We lied on the books.”

Key Performance Indicators (KPIs)

Metrics that supposedly predict success. In extraction terms: numbers that look good while the business dies.

Killing It

Making money. Or claiming to make money. Or raising money while losing money. In extraction economy, all three mean the same thing.

Lean Operations

Firing everyone except the minimum needed to keep the lights on. Also called: “One person gets sick and everything collapses.”

Leaving Money on the Table

What extractors say when companies charge fair prices instead of maximum prices. "You’re leaving money on the table!" Translation: "You could be extracting more."

Costco "leaves money on the table" with 11% markups and $1.50 hot dogs. Result: $400 billion company with 90%+ customer renewal. Meanwhile extractors who "captured all the value" are bankrupt.

Leaving money on the table is actually leaving money in customers’ pockets. They come back. Forever. Turns out the table that matters is the one 20 years from now, not this quarter.

Leprino Foods

The monopoly nobody’s heard of.

Controls 85% of mozzarella cheese in America.

Supplies every pizza chain, every Italian restaurant, every frozen pizza.

Papa John’s, Domino’s, Pizza Hut, Hot Pockets — all Leprino cheese.

That "artisanal" pizza place? Same cheese as Pizza Hut.

The monopoly works through patents:

Leprino owns 50+ patents on cheese manufacturing processes.

Not cheese itself, but how to make it melt properly, stretch correctly, brown evenly, freeze without breaking down.

Want cheese that doesn’t separate when reheated? Leprino patent.

Need mozzarella that browns in conveyor ovens? Leprino patent.

Other manufacturers can’t compete — the patents block them.

Make similar cheese? Patent lawsuit.

Make different cheese? Doesn’t perform for restaurant applications.

So restaurants buy Leprino.

Through Sysco.

At whatever price Leprino sets.

The monopoly stays invisible by design: no consumer products, no retail presence, business-to-business only.

Customers eating pizza have no idea.

Restaurants know but can’t escape.

Food critics don’t investigate ingredient sourcing.

85% market share.

50+ patents.

Zero visibility.

The most successful monopoly is the one nobody knows exists.

Labor Arbitrage

Replacing expensive workers with cheap workers.

"We’re pursuing labor arbitrage opportunities" means "We’re firing Americans and hiring overseas contractors at 1/10th the cost."

Consultants love this term because it sounds like smart economics instead of mass layoffs.

The arbitrage: workers in Country A earn $60K, workers in Country B earn $6K, pay Country B workers, pocket the difference, call it optimization.

Quality collapses.

Institutional knowledge disappears.

Products fail.

But the spreadsheet looked great for two quarters.

See also: Cost Optimization, Margin Improvement.

Leverage

Borrowing money. Private equity loves leverage. They borrow 90% to buy companies. Companies pay the interest. Private equity keeps the upside.

Leveraged Buyout (LBO)

Buying a company mostly with borrowed money. The company pays the debt. Buyers extract the profits. If it fails, the company goes bankrupt. Buyers keep the fees.

Liability

What shareholder value theory calls employee benefits, healthcare, pensions. “Benefits are a liability on the balance sheet.” Translation: “Keeping workers healthy costs money. Cut coverage.” Under extraction accounting, taking care of humans who build your company is a negative. A cost to minimize. A burden to shed. Never mind they might stay longer, work better, build more. The quarterly report shows liabilities, not loyalty.

Lifestyle Business

Derogatory term venture capitalists use for profitable companies that don’t need investors.

"That’s just a lifestyle business" means "The founder makes $500K annually, owns 100%, works 30 hours weekly, and answers to nobody. We can’t extract from that."

A lifestyle business is what the extraction economy calls freedom.

It’s not venture-scale because it doesn’t need venture capital.

It’s not disruptive because it solves real problems for real customers at fair prices.

It’s sustainable, profitable, and controlled by the person who built it.

Everything venture capital claims to want but actually despises.

Because you can’t extract fees from a business that doesn’t need you.

**Limited Partner** (LP): The people who actually fund private equity and venture capital. They take all the risk. General partners take fees and carry. LPs would be better off buying index funds.

Liquidation Preference

Term that ensures investors get paid before founders during an exit. Usually 1x. Sometimes 2x or 3x. Means founders can build a $100M company and get nothing if venture capitalists structured it right.

Loyalty

What shareholder value theory calls “inefficiency.” “Employee loyalty is inefficient. We can replace them with cheaper workers.” Translation: “Workers who stay 20 years expect raises, benefits, respect. Fire them. Hire cheaper.” Under extraction logic, dedication to the company that pays you is a character flaw. Commitment is a liability. Tenure is waste. Better to churn through disposable workers who cost less. Never mind they built the company. Never mind they know how things work. The spreadsheet says loyalty is expensive.

Moral Failure

What extractors call it when poor people don’t pay debts.

Same action as "strategic default" but committed by people without lawyers.

A worker who stops paying credit card bills after medical bankruptcy: moral failure.

A billionaire who walks away from $7 billion in casino debt: strategic default.

The words reveal the game.

One is character judgment.

The other is business decision.

Poverty gets moralized.

Wealth gets strategized.

When a nurse can’t pay hospital bills from her own heart attack, extractors call it personal responsibility and moral failure.

When Trump doesn’t pay contractors who built his towers, extractors call it leverage and negotiation.

The debt is the same.

The inability to pay is the same.

Only the bank account balance determines whether you’re immoral or strategic.

Moral failure is what the extraction economy calls bankruptcy when you’re not rich enough to afford the better terminology.

Management Buyout (MBO)

When executives team up with private equity to buy their own company.

Sounds better than "hostile takeover."

Sounds like management taking control.

Actually means management becoming complicit in extraction.

Same scam as any leveraged buyout.

Management gets 10%.

Private equity gets 90%.

The company gets loaded with debt.

Fees get extracted.

Workers get fired.

Eventually the company gets destroyed.

But now the executives cooperate because their golden parachutes depend on it.

Dell did this. Michael Dell and Silver Lake Partners loaded it with $67 billion in debt.

Hilton did this. Blackstone loaded it with $26 billion.

Management buyouts aren’t management saving companies.

They’re management selling out their employees for a cut of the extraction.

The executives who built careers at the company betray everyone who works there.

They fire colleagues they’ve known for decades.

Raid pensions of workers who trusted them.

All for 10% of the take.

Management buyouts are what you call it when the guards join the thieves.

Management Fee

2% of committed capital. Every year. For 10 years. Whether the fund performs or not. The real business model for venture capitalists and private equity.

Margin Improvement

Increasing profit margins by cutting costs. Sounds like good business. Actually means: reduce quality, fire experienced workers, use cheaper materials, eliminate service, and hope customers don’t notice before the exit.

"We achieved 500 basis points of margin improvement" translates to "We cut so many corners the product barely works, but it’ll take 18 months for customers to figure it out and by then we’ll have sold the company."

Consultants present margin improvement as strategy. It’s just extraction with math. See also: Cost Optimization, Labor Arbitrage.

Market-rate Compensation

Pay that’s below what the person was making before. “We’re adjusting you to market rate” means “We’re cutting your salary and calling it alignment.”

Marking to Market

Adjusting valuations based on current market conditions. Also called “marking to make-believe” when venture capitalists value unicorns that can’t exit.

Meritocracy

The belief that success comes from skill and hard work. Used by extractors to justify why they’re rich and others aren’t. Ignores timing, luck, inheritance, and rigged systems.

Moat

Competitive advantage. Extractors don’t build moats. They buy companies that have moats, then extract value until the moat disappears.

Monopsony

Market with only one buyer. Opposite of monopoly. When private equity rolls up all veterinary clinics in a city, there’s one buyer for vet techs. Can’t negotiate wages. Can’t leave for competitors. Workers are captive. Wages stay flat while profits soar. Economics textbooks say monopsony is rare. Extraction economy made it standard.

Multi-Stakeholder Governance

World Economic Forum term for oligarchy. Corporate leaders making policy decisions without democratic process. Also known as: public-private partnerships, corporate coordination, stakeholder capitalism. History calls it: oligarchy. Means: Banking CEOs decide financial regulations, Tech CEOs decide content rules, Pharma CEOs decide health policy. Governments implement what Summit members decide. Private decision, public enforcement.

Multiple

How many times earnings (or revenue, or EBITDA) someone paid for a company. High multiples mean overpaying. Or in venture capital terms: “Normal pricing.”

Money Heaven

The fantasy extractors sell to founders. "Take our money! It’s raining from the sky! No strings attached!" Reality: Every dollar from venture capital comes with strings. Growth targets. Board seats. Liquidation preferences. Exit pressure.

Money heaven is actually money hell with better marketing. The cash feels free when it arrives. The bill comes due when founders try to exit. Or when they can’t.

Builders know: the only free money is profit from customers who value what gets built.

"Never Let a Good Crisis Go to Waste"

Extractor motto.

Attributed to Rahm Emanuel (Obama’s Chief of Staff) during 2008 financial crisis.

Means: when people are desperate, vulnerable, and distracted, that’s the perfect time to extract.

Financial crisis? Buy assets cheap.

Pandemic? Consolidate industries.

Natural disaster? Raise prices.

War? Profit from reconstruction.

The crisis hurts everyone else.

Extractors see opportunity.

Not empathy.

Not help.

Extraction.

Every crisis becomes a profit mechanism.

Hurricane destroys homes? Private equity buys the land.

Recession causes unemployment? Lower wages.

Bank collapse? Bail out banks, extract from taxpayers.

Extractors don’t cause every crisis.

But they profit from all of them.

That’s not opportunism.

That’s sociopathy with a business plan.

Network Effects

When a product gets better as more people use it. Real for some businesses (phones, social networks). Claimed by every startup. True for almost none.

Non-Compete Clause

The cage that closes after the check clears.

When private equity buys your dental practice, the pitch sounds perfect: cash out at 5-8x revenue, stay on as an employee, keep seeing patients, no more administrative headaches.

What they don’t mention:

The non-compete clause that traps you for 3-5 years within 25-50 miles.

The performance quotas that start immediately.

The scripted upselling required.

The extraction metrics tracked daily.

Dentist realizes the horror within months: pushing crowns patients don’t need, recommending procedures for profit not health.

Tries to quit.

Can’t.

The non-compete traps them.

Can’t open another practice.

Can’t work for competitors.

The cash from the sale? Gone to taxes and lifestyle inflation.

So they stay.

Extracting from patients they’ve known for decades.

The funeral director reads scripts to widows.

The vet recommends $4,000 treatments for $400 problems.

All trapped by the clause they signed when the money looked good.

Private equity calls it "protecting our investment."

Translation: "We own you for 3-5 years and you’ll extract for us whether you want to or not."

Non-core Assets

Anything we can sell for cash. Buildings. Equipment. Subsidiaries. Doesn’t matter if they’re useful. We need cash now.

Omelette

“You can’t make an omelette without breaking a few eggs.” What extractors say to justify layoffs, bankruptcies, destroyed communities. The eggs are people’s lives. The omelette never gets made. Or when it does, extractors eat it and workers get shells.

Operational Efficiency

Consultant-speak for "fire people until barely functional."

Circuit City fired 3,400 highest-paid sales staff for "operational efficiency."

Sales collapsed.

Company died.

Nursing homes cut staff to "minimum legal levels" for "operational efficiency."

One nurse for 30 patients.

Patients develop bedsores.

Infections.

Falls.

Die.

But the spreadsheet looks better.

That’s what matters.

When extractors say "operational efficiency," they mean: cut what keeps things running, extract the difference, blame failure on "market conditions."

Real efficiency means doing more with less waste.

Extraction efficiency means doing less with fewer people and calling the carnage "optimization."

See also: Rightsizing, Span and Layer Adjustments, Efficiency Gains.

Operational Synergies

Private equity’s favorite merger justification.

Translation: "We’re loading both companies with shared debt while extracting fees."

When Castle Harlan merged Famous Dave’s and Don Pablo’s in 2006, they called it "operational synergies."

Two regional comfort food chains combined to create "efficiencies."

Actually meant: one shared debt pile, one set of extraction fees, one bankruptcy when it collapsed.

The synergy isn’t operational.

It’s extractional.

Combine supply chains to squeeze vendors.

Merge back offices to fire people.

Consolidate real estate to sell locations.

Every "synergy" means someone loses their job or their business.

The only thing that synergizes is the extraction.

Private equity gets fees coming and going.

Management fees for the merger.

Success fees for "creating value."

Monitoring fees for "operational improvement."

The companies get debt.

Employees get layoffs.

Communities get closed locations.

But the PowerPoint showed beautiful synergies.

That’s what matters.

See also: Economies of Scale, Consolidation, Strategic Merger.

Opportunistic

What extractors call themselves when explaining why they loaded debt on a healthy company during a crisis. “We’re opportunistic investors” means “We exploit vulnerable situations.” Michael Saylor used this describing MicroStrategy’s debt-funded Bitcoin buying spree. Opportunistic sounds strategic. Professional. Measured. Actually means: saw someone bleeding, took what they had, called it timing. When extractors say “we’re being opportunistic,” translate it: “We’re extracting from people who can’t defend themselves right now.”

Optimization

Making something work better. Or in extraction terms: Cutting costs until barely functional. Consultants love this word. “We’re optimizing operations” means “We’re firing people and calling it progress.” McKinsey’s favorite euphemism for elimination. When they say “optimization,” they mean layoffs. When they say “operational optimization,” they mean mass layoffs. The word sounds scientific, strategic, inevitable. Actually it’s just extraction dressed as improvement. See also: Rightsizing, Synergy Capture, Span and Layer Adjustments.

Overhead

Employees who don’t generate revenue. Also known as: everyone who keeps the business running but isn’t in sales.

Participation Rights

Investor terms that let them get paid twice. Once with their preferred shares. Again with common shares. Founders get paid zero times if investors structured it c