Claire’s filing for bankruptcy again isn’t just about changing fashion trends or TikTok outpacing scrunchie sales. The real villain here is private equity. When Apollo Global Management scooped up Claire’s in 2007, it wasn’t because they loved ear piercing kiosks or glitter gel pens. It was because they saw a cash cow that could be milked dry.
Here’s how it works: private equity loads a healthy company with mountains of debt in a leveraged buyout. The company itself—not the investors—takes on that debt, while the financiers bleed it for fees, interest, and short-term payouts. When mall traffic dipped and online competition rose, Claire’s didn’t have breathing room. It had debt shackles.
Sound familiar? Joann Fabrics is walking the same plank. Once a reliable place for crafters, it was gutted by private equity and saddled with obligations it couldn’t sustain. Now, bankruptcy looms there, too.
Private equity loves to market itself as “unlocking value.” In reality, it’s more like a slow siphon—sucking life out of beloved brands until there’s nothing left but empty storefronts and broken communities. Claire’s second bankruptcy isn’t bad luck. It’s the business model. And that model is a scourge on society.
