Thursday, May 26, 2022

PE-backed companies make up far less than 10% of total U.S. GDP, but when the owner of a private business with some scale is looking to grow the business or take some money off the table, a private equity partner is likely to come calling. When that happens, it is important for a business owner to understand a bit about how PE funds approach the transaction. And if PE funds don’t come calling, the business owner may want to take some steps to attract them. Read How to Attract Buyers in Private Equity Transactions to learn about both subjects. If you own a business and are thinking about taking an investment from private equity, you need to think about what kind of partner the fund will be. Nothing will replace real due diligence of the specific PE firm at issue, but you can certainly learn some important generalities by reading Psychology of a Private Company Board in Fund-Owned Businesses.

Most investors are familiar with the public equity market. This is what we call the “stock market.” However, there is a second, much larger market—the private company market—that has the potential to provide outsized returns and portfolio diversification. A primary way to access this market is by investing in it indirectly, though a private equity fund. But should you? If so, who do you? For your very quick reading pleasure:

• 90 Second Lesson – Private Equity Sponsor v. Private Equity Fund

• 90 Second Lesson: How Does a Private Equity Fund Work? Explaining Sponsors, General Partners and Limited Partners

• 90 Second Lesson – Fees and Carried Interest: Private Equity Sponsor Compensation

Need some weekend reading? The following are not 90-second reads, but they are nine minute or less reads. And you should spend at least nine minutes researching before you decide to look for a PE fund to invest in. Right?

• Alternative Asset Investments May Help When Stocks Decline

• Alternative Assets and the “Average” Accredited Investor Installment #10: Private Equity, aka PE Investments

• The Challenges Ahead for Private Equity Investing

• An Initiation Into Private Equity Funds

• 6 Things to Consider When Selecting a Private Equity Investment

• 6 Reasons Private Equity Makes a Great IRA Investment Option

• Why Your RIA Fears Private Equity Investments

• 5 Questions Investors Should Ask Before Making a Private Equity Investment

• Critical Considerations When Selecting a Private Equity Manager

• Are Investors Still Happy with Private Equity Performance?

When a private equity portfolio company is being prepared for sale, it can be a confusing time for employees. Most people do not understand the PE business, and therefore have a cautious attitude due to what they read in the news. No one likes uncertainty, especially if it may impact their job security during a business sale. Read Private Equity Exits: What Employees Should Know. It will help.

Want to better understand how PE funds do what they do? Maybe you're a would-be investor who wants to learn more? Or a newly hired analyst at a PE firm? Or an attorney or accountant with PE clients? Or an MBA student looking for a job? Regardless of your motivation, if you want to learn more about PE, we got you covered.

• Private Equity vs. Venture Capital 101

• What is Private Equity? A Brief History

• Private Investment Fund Terms and Conditions: The Relationship Between GPs and LPs

• 5 Investment Strategies PE Firms Use to Choose Portfolio Companies

• How Reliable Are Private Equity Valuations?

• Fundless Sponsors Appeal to Individual Investors with Fewer Fees, More Specificity on Deals

These hour-long webinars dive deep into a variety of topics, each delivered by a panel of experts in the respective fields. Each webinar comes with a complimentary slideshow PDF. All on demand webinars are $19.99.

Opportunity Amidst Crisis- Buying Distressed Assets, Claims, and Securities for Fun & Profit
(from the series Restructuring, Insolvency & Troubled Companies)

Structuring and Planning the M&A Transaction
(from the series M&A Boot Camp)

Data Breach Response: Before and After the Breach
(from the series Cyber Security & Data Privacy)

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