Private equity explained
How private equity works, what it asks of you and where the returns come from. In plain English, without the sales pitch.
What is private equity?
Investing in companies that are not listed on a stock exchange: how a fund works, where the returns come from and how it differs from the stock market.
Investing in private equity: not all at once
You commit an amount, but pay it in stages, as and when the fund needs the money. Each of these requests for payment is called a capital call.
What is the J-curve?
Why a private equity fund calls more capital than it distributes in its first few years, and why that can reverse later on.
What is the difference between venture, growth and buyout?
3 strategies, 3 types of company: how venture, growth and buyout relate to each other.
How do you measure private equity returns?
Money goes into the fund in stages and comes back in stages. This is how you read TVPI, DPI and IRR.
Why the choice of fund manager carries so much weight
In private equity, the results of fund managers are much further apart than on the stock market.
