Despite being often used interchangeably, “private equity” and “venture capital” are not synonymous. Both terms refer to companies that invest in private companies for equity, but they accomplish the task in different ways. What is Private Equity? In private equity, a group of investors directly invests in a company. Private equity investors generally invest in mature companies that have passed the growth stage. Often, they provide funding to struggling businesses. Additionally, some investors will acquire a business, improve its operations, and then sell it for a profit. Private equity investors always strive to generate a return on their investment by enhancing company value over its initial value. Large institutional investors, including pension funds and large private equity firms funded by accredited investors, dominate the private equity sector. Pros and Cons of Private Equity A private equity investor will provide you with more than just cash — you will also benefit...
This blog is a helpful guide with tips on securing funding for your small business, with insights into how to approach investors and secure loans.