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Introduction to Private Equity

Book Description

Introduction to Private Equity is a critical yet grounded guide to the private equity industry. Far more than just another introductory guide, the book blends academic rigour with practical experience to provide a critical perspective of the industry from a professional who has worked at many levels within the industry, including insurance, funds of funds, funds and portfolio companies.

The book looks at private equity from the point of view of the individual or the business. How is a private business valued? How is the acquisition transaction processed? What are the due diligence issues that should be considered before moving ahead? A valuable insight to a rather opaque market.

Introduction to Private Equity covers the private equity industry as a whole, highlighting its historical development in order to put its recent development into perspective. The book covers its organization, governance and function, then details the various segments within the industry, including LBO, Venture Capital, Mezzanine Financing, Growth Capital and beyond. Finally, it offers a framework to anticipate and understand its future developments.

It provides a balanced perspective on the current corporate governance challenges which are affecting the industry and draws perspective to understand the evolution of the sector, following one of its major crises.

Table of Contents

  1. Dedication
  2. Title Page
  3. Copyright Page
  4. Foreword
  5. Acknowledgements
  6. About the Author
  7. Introduction
    1. A MOVING TARGET
    2. A CONSUBSTANTIAL LACK OF INFORMATION
    3. BENIGN NEGLECT, MALIGN CONSEQUENCES
    4. KNOWING THE DEVIL TO CIRCUMVENT IT
  8. Part I - What is Private Equity?
    1. Chapter 1 - Private Equity as an Economic Driver: An Historical Perspective
      1. 1. POOLING INTERESTS TO IDENTIFY AND EXPLOIT SOURCES OF WEALTH
      2. 2. CHAMPIONING ENTREPRENEURSHIP
      3. CONCLUSION: AN ATTEMPT AT DEFINITION
    2. Chapter 2 - Modern Private Equity - A French Invention?
      1. 1. USA: THE FOUNDRY OF MODERN PRIVATE EQUITY
      2. 2. EUROPE: ADAPTING A SUCCESSFUL MODEL OR CREATING ITS OWN?
      3. CONCLUSION: EMERGING MARKETS, BUILDING CASTLES ON SAND?
  9. Part II - The Private Equity Ecosystem
    1. Chapter 3 - Private Equity: A Business System Perspective
      1. 1. WE ARE ALL INVESTORS IN PRIVATE EQUITY
      2. 2. ORGANISATION AND GOVERNANCE OF PRIVATE EQUITY FUNDS
      3. 3. MEASURING PERFORMANCE, MANAGING RISKS AND OPTIMISING RETURNS
      4. 4. PITFALLS AND CHALLENGES
      5. CONCLUSION
    2. Chapter 4 - The Universe of Investment
      1. 1. VENTURE CAPITAL: FINANCING COMPANY CREATION
      2. 2. GROWTH CAPITAL: FINANCING COMPANIES' EXPANSION
      3. 3. LEVERAGED BUY-OUT: FINANCING COMPANIES' TRANSMISSIONS
      4. 4. OTHER INTERVENTIONS IN PRIVATE EQUITY
      5. CONCLUSION
    3. Chapter 5 - The Process of Investment: A Matter of Trust and Mutual Interest
      1. 1. STEP 1: PRELIMINARY ANALYSIS
      2. 2. STEP 2: VALUATION
      3. 3. STEP 3: NEGOTIATING
      4. 4. STEP 4: STRUCTURING
      5. 5. STEP 5: COMPLEMENTARY DUE DILIGENCES
      6. 6. STEP 6: TRANSACTION
      7. 7. STEP 7: MONITORING AND EXIT
      8. CONCLUSION
  10. Part III - Private Equity in Teenage Time: Trend Setting, Fads and Responsibilities
    1. Chapter 6 - Private Equity Evolution: Trends or Buzzes?
      1. 1. IS PRIVATE EQUITY GOING MAINSTREAM?
      2. 2. IS PRIVATE EQUITY (STILL) CREATING VALUE?
      3. 3. PRIVATE EQUITY: BETWEEN BUBBLES AND CRASHES
      4. CONCLUSION
    2. Chapter 7 - Private Equity and Ethics: A Culture Clash
      1. 1. GREED
      2. 2. DESTRUCTION
      3. 3. PHILANTHROPY
      4. 4. TRANSPARENCY
      5. 5. CONFIDENTIALITY AND SELF-REGULATION
      6. CONCLUSION
  11. General Conclusion - Private Equity Today and Tomorrow
  12. Glossary
  13. Bibliography
  14. Index