O'Reilly logo

Introduction to Private Equity by Cyril Demaria

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

2
Modern Private Equity - A French Invention?
Human needs have increased and diversified throughout history. The subsequent ventures evolved substantially as well, notably with the agricultural and industrial revolutions. Venture capital has mutated with these ambitions. Just as Columbus was a European individual discovering America, it was a European going to the US who would formalise modern venture capital: Georges Doriot. In the early stage of venture capital, the entrepreneur and the investment manager were slowly emerging as distinct figures. Modern venture capital oversaw the differentiation between the capital provider (the investor) and the investment manager.
By pushing the differentiation of roles further, the different actors of the venture capital industry paved the way for its professionalisation. Investors were monitoring and controlling the investment managers. Investment managers were selecting ventures and monitoring the investments. Entrepreneurs were building the ventures and were structuring the companies effectively.
Entrepreneurs learn mainly by doing, which is a constantly renewed process as each venture is unique. With regard to investments, investors often adopt a ‘hands-off’ attitude. Investment managers, by offering investors the opportunity to dedicate their time to investing concretely, had to develop their own methodology and a philosophy of investment.
The French General Georges Doriot initiated this effort in 1946 (Gupta, 2004). Does this mean ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required