Private Equity

Funds that take full or partial ownership in companies with the goal of improving the business, increasing its value and then exiting at a profit via an initial public offering or sale to a strategic buyer or financial sponsor. 

Private equity strategies can be categorized depending on where they invest in the company lifecycle: 

• Venture capital: Seeks to invest in early-stage companies that show promising potential in the hope of achieving multiples on the original investment. Typically, venture capital target companies exhibit the following characteristics: high revenue growth rates, short operating histories and not yet profitable.    
• Growth equity: Seeks companies that are on track to or nearing profitability as well as firms that require additional capital to expand. 
• Leveraged buyout: Seeks more mature public and private companies with an aim to implement operational efficiencies and/or grow market share.  
• Distressed/special situations: Investing in the equity or debt of companies confronting financial difficulty. Investors aim to take control during a restructuring to implement changes and return the firm to profitability before exiting at a profit. 
• Secondaries: Investing into existing private equity funds ranging from venture capital to distressed/special situation. Investors in secondaries are typically motivated by potentially purchasing shares of existing funds at a discount, with lower risk and a shorter time to an exit.