Companies" Ills Did Not Harm Romney's Firm The Boston headquarters of Bain Capital, a firm that usually found a way to make money from companies it controlled even when they ultimately went bankrupt. Cambridge Industries, an automotive plastics supplier whose losses had been building for three consecutive years, finally filed for bankruptcy in May 2000 under a mountain of debt that had ballooned to more than $300 million. Yet Bain Capital, the private equity firm that controlled the Michigan-based company, continued to religiously collect its $950,000-a-year "advisory fee" in quarterly installments, even to the very end, according to court documents. In all, Bain garnered more than $10 million in fees from Cambridge over five years, including a $2.25 million payment just for buying the company, according to bankruptcy records and filings with the Securities and Exchange Commission. Meanwhile, Bain's investors saw their $16 million investment in Cambridge wiped out. That Bain was able to reap revenue from Cambridge, even as it foundered, was hardly unusual. The private equity firm, co-founded and run by Mitt Romney, held a majority stake in more than 40 United States-based companies from its inception in 1984 to early 1999, when Mr. Romney left Bain to lead the Salt Lake City Olympics. Of those companies, at least seven eventually filed for bankruptcy while Bain remained involved, or shortly afterward, according to a review by The New York Times. In some instances, hundreds of employees lost their jobs. In most of those cases, however, records and interviews suggest that Bain and its executives still found a way to make money. Mr. Romney's experience at Bain is at the heart of his case for the presidency. He has repeatedly promoted his years working in the "real economy," arguing that his success turning around troubled companies and helping to start new ones, producing jobs in the process, has prepared him to revive the country's economy. He has fended off attacks about job losses at companies Bain owned, saying, "Sometimes investments don't work and you're not successful." But an examination of what happened when companies Bain controlled wound up in bankruptcy highlights just how different Bain and other private equity firms are from typical denizens of the real economy, from mom-and-pop stores to bootstrapping entrepreneurial ventures. Bain structured deals so that it was difficult for the firm and its executives to ever really lose, even if practically everyone else involved with the company that Bain owned did, including its employees, creditors and even, at times, investors in Bain's funds. Bain officials vigorously disputed any notion that the firm had profited when its investors lost, arguing that a full accounting of their costs across their business would show otherwise. They also pointed out that Bain employees put their own money at risk in all of the firm's deals. "Bain Capital does not make money on investments when our investors lose money," the company said in a statement. Any suggestion to the contrary is based on a misleading analysis that examines the income of a business without taking account of expenses. To a large extent, however, this is simply the way private equity works, offering its practitioners myriad ways to extract income and limit their risk. Mr. Romney's candidacy has helped cast a spotlight on an often-opaque industry. In four of the seven Bain-owned companies that went bankrupt, Bain investors also profited, amassing more than $400 million in gains before the companies ran aground, The Times found. All four, however, later became mired in debt incurred, at least in part, to repay Bain investors or to carry out a Bain-led acquisition strategy. Perhaps most revealing are the few occasions, like with Cambridge Industries, when Bain's investors lost. Lucrative fees helped insulate Bain and its executives, records and interviews showed. Piling On Debt Having spun off from a management consulting firm, Bain has always been known for its data-driven, analytical approach. Under Mr. Romney, the firm scored some remarkable successes, enabling its investors - wealthy individuals and institutions like pension funds - to collect stellar returns.