Michael Milken

1980s · The junk-bond pioneer

Who they were

Michael Milken built Drexel Burnham Lambert into the center of the high-yield bond market, and in doing so created the capital structure that made the leveraged buyout possible at scale. His 'junk bond' market let sponsors finance take-privates with debt that was previously unavailable to them, dramatically expanding the size and reach of private equity deals.

Why it mattered

Milken's high-yield market was the fuel behind the 1980s LBO boom. Whether you view his work as a great expansion of capital access or a dangerous excess, it established the debt markets that private equity still relies on today. The modern LBO is unthinkable without the infrastructure his market created.

The AI angle

Milken's innovation was about the speed and availability of capital. AI is doing the same for the operational side: the data and models that let a sponsor underwrite a leveraged deal with confidence, and then manage the debt and the company's performance in real time.

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