When you’ve got a revenue producing firm that’s been working for a couple of years, and you’re enthusiastic about taking it via to the next stage of development – whether it’s some cash injection or a complete overhaul – then consider looking into partnering with a private equity investor.
Initially, what’s ‘private equity’? Briefly, it’s finance provided by investors in alternate for an equity stake within the company. This type of funding is mostly associated with mature corporations with growth potential that want regeneration. A wide range of trade sectors benefit from PE resembling technology, industrial, healthcare, banking and finance and more.
Persons are typically confused in regards to the distinction between private equity and venture capital. Enterprise capital is actually a form of private equity however the principle distinction is that it tends to fund youthful companies comparable to start-ups and rising companies.
Now that you simply know a little bit more, don’t stop there – there’s plenty of resources on the market that will educate you all it is advisable know about private equity funding. This is only the beginning.
Once you have finished some more research, let’s take you through what you would wish to do to acquire this type of funding for your company. The first thing you’ll need to do to start your journey is to interview potential investors.
We understand how complicated it is to search for the right investor, so we’ve listed some key questions it’s best to ask when trying to find the correct investor to partner with for the long-term:
How a lot management will management and shareholders have?
Will there be observe-on investments? In that case, what are the terms?
How experienced are the private equity firm in your sector?
Who’re the details of contact?
What will happen if either party wants to exit the deal?
What costs will the enterprise be responsible for?
What’s the investment horizon?
What does capital construction look like?
As well as having these questions, we advocate that there is always a very good lawyer present to negotiate in your behalf. You will need to discover a law firm with expertise not only in private equity funding, but they have to even have the commercial experience to be able to put themselves in the position of the management or founder. Select your lawyers with care and look out for independent references.
Here is more info about executive search for private equity firms review our page.