Private Equity has become an increasingly attractive asset class. Unfortunately due to its success, lots of capital has poured into the sector. More capital chasing the same number of opportunities has increased prices and reduced returns.
Nonetheless, there are still some very good opportunities and many VC-backed businesses will exit to PE so its still a very exciting time to be investing.
Nonetheless, there are still some very good opportunities and many VC-backed businesses will exit to PE so its still a very exciting time to be investing.
My top 5 investment criteria for growth private equity (£5m - £40m cheques):
1. Management Team – Who am I backing to make this a success? Yes I could replace them but that’s not much fun. I want to get on with business, not politics.
2. Financial Performance – What has happened in the past? If good, why will it continue? If poor, why will it suddenly change?
3. Market Growth – Are we going to succeed against all odds or are we merely going to ride the proverbial growth wave?
4. Capex Requirements – Is the estate under-invested? Is the business cash-hungry?
5. Competitive Advantage – Am I buying the market leader? Why not? Is their source of competitive advantage sustainable?
If things don’t work out, you’ll likely be interested in the next post on distressed private equity investing.
See you there,
Alex @ The Tippy Top Blog
Please Like, Share, Follow and Subscribe to The Tippy Top!
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Key:
1 of 5 - Intro
2 of 5 – Angel Investing (£50k – £500k)
3 of 5 – Venture Capital (£500k - £5m)
4 of 5 – Growth Private Equity (£5m - £40m)
5 of 5 – Distressed Private Equity (£5m - £40m)
1. Management Team – Who am I backing to make this a success? Yes I could replace them but that’s not much fun. I want to get on with business, not politics.
2. Financial Performance – What has happened in the past? If good, why will it continue? If poor, why will it suddenly change?
3. Market Growth – Are we going to succeed against all odds or are we merely going to ride the proverbial growth wave?
4. Capex Requirements – Is the estate under-invested? Is the business cash-hungry?
5. Competitive Advantage – Am I buying the market leader? Why not? Is their source of competitive advantage sustainable?
If things don’t work out, you’ll likely be interested in the next post on distressed private equity investing.
See you there,
Alex @ The Tippy Top Blog
Please Like, Share, Follow and Subscribe to The Tippy Top!
Twitter | Facebook | Instagram | LinkedIn | Snap | BlogLovin' | Medium | Pinterest
Key:
1 of 5 - Intro
2 of 5 – Angel Investing (£50k – £500k)
3 of 5 – Venture Capital (£500k - £5m)
4 of 5 – Growth Private Equity (£5m - £40m)
5 of 5 – Distressed Private Equity (£5m - £40m)
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