What private equity offers investors
A private equity fund is a long-term investment vehicle that delivers stable returns, even in a low-yield environment, to institutional investors such as insurers and pension funds.
Investors commit capital to the fund for a period of at least ten years. This capital is invested in a portfolio of companies, which the fund manager seeks to transform through active ownership over a period of 3-5 years. The returns enable investors to meet their long-term liabilities, even during periods of economic downturn.
European private equity enjoys the added advantage of operating and investing in the world’s largest single market and a stable, proven economy. European fund managers are experienced and expert in locating opportunities across this diverse continent.
The European mid-market is a good example of the region’s strength. European mid-market businesses are export-oriented, focus on the long-term and use modern management techniques. Private equity fund managers often specialise in running these companies, which regularly punch above their weight in terms of sustained job creation and revenue generation. You can learn more about the mid-market in our report: Delivering the Goods.
Venture capital (VC) funds typically invest in new, innovative businesses to help them grow. European VC can offer seasoned managers with the skills to commercialise this innovation and bring it to a global market. Examples of VC-backed companies include Skype, SoundCloud and Rovio, the creators of Angry Birds. You can learn more about European VC in our report: Smart Choice.