What is Private Equity Investment?
Private equity investment is a process of investing money in a company with purchasing any stocks and bonds traded on the stock exchange. This type of investment, thus, is not small amount. So, it is little bit difficult for common people to invest their money in private equity.
Who are these Private Equity Investors?
Typically, high net-return or private equity firm invest money in this type of investment. This investor aimed to earn huge margin of profit by investing in companies when the company are small, once company becomes expand, they sell their shares.
Such kinds of investors invest their money on new company or existing company that plans to grow. As result, the return amount is huge.
How Does Private Equity Investment Works?
Most of investors are belongs to private firms that increase capital from endowment funds, internal sources, commercial and private investor, when they collect excess amount, either they purchase existing company’s stake and take managerial roles or assists companies to build by lending capital.
In case of new startup company that looks private equity capital, the investment company gives initial capital, with necessary assist required throughout initial stages. They take care the current growth rate of the company, plan, restructure, and once it perform well; them create it public, capturing large share of the company’s share.