Accent Capital Partners

Overcoming Any Misconceptions

About Private Equity

It’s a catch 22: you need funds to grow your business, but banks won’t lend the amount you need. For the business owner, and the banker whose hands are tied by strict debt-to-equity limits, the frustration is obvious. Yet your solution may be just around the corner: private equity (PE).

PE: Little Understood, But Highly Effective

Many successful smaller companies wrongly assume that PE is a source of funds only available for firms that are already large.

This misconception arises from the industry’s history. PE grew out of the leverage buyout firms that purchased and disemboweled major conglomerates in high-profile deals during the 1980s. Other people only know the venture capital part of the industry, which received a lot of attention during the high-tech boom for funding start-up companies. In reality, neither picture is complete.

Today, Gordon Gekko and his “greed is good” mantra is long gone and the dot com boom has busted, yet PE is alive and well. This complex industry gathers private and institutional money into funds with a range of objectives, including:

Buyout Funds
Hedge Funds
Venture Funds
Growth Capital Funds
Dedicated Capital from Wealthy Individuals

Each PE firm places its money in one or more funds to make investments in what are referred to as “portfolio companies.” The part of the PE industry that my firm focuses on is growth capital: funds that help companies grow to the next level.

PE 101

PE firms provide equity funding in return for an ownership stake. They usually invest cash in exchange for convertible preferred shares in the portfolio company.

While many firms focus on larger businesses seeking $50 million or more in funding, a number of PE firms work with growing businesses valued at $5 to $50 million and seeking as little as $2 million in funding. The funding can take many forms, ranging from common stock to convertible debt. However, unlike traditional funding sources, the PE firm becomes actively involved in the companies it funds through board representation and active mentoring.

Accent

Capital

Partners

Accent Capital Partners

Overcoming Any Misconceptions

About Private Equity

It’s a catch 22: you need funds to grow your business, but banks won’t lend the amount you need. For the business owner, and the banker whose hands are tied by strict debt-to-equity limits, the frustration is obvious. Yet your solution may be just around the corner: private equity (PE).

PE: Little Understood, But Highly Effective

Many successful smaller companies wrongly assume that PE is a source of funds only available for firms that are already large.

This misconception arises from the industry’s history. PE grew out of the leverage buyout firms that purchased and disemboweled major conglomerates in high-profile deals during the 1980s. Other people only know the venture capital part of the industry, which received a lot of attention during the high-tech boom for funding start-up companies. In reality, neither picture is complete.

Today, Gordon Gekko and his “greed is good” mantra is long gone and the dot com boom has busted, yet PE is alive and well. This complex industry gathers private and institutional money into funds with a range of objectives, including:

Buyout Funds
Hedge Funds
Venture Funds
Growth Capital Funds
Dedicated Capital from Wealthy Individuals

Each PE firm places its money in one or more funds to make investments in what are referred to as “portfolio companies.” The part of the PE industry that my firm focuses on is growth capital: funds that help companies grow to the next level.

PE 101

PE firms provide equity funding in return for an ownership stake. They usually invest cash in exchange for convertible preferred shares in the portfolio company.

While many firms focus on larger businesses seeking $50 million or more in funding, a number of PE firms work with growing businesses valued at $5 to $50 million and seeking as little as $2 million in funding. The funding can take many forms, ranging from common stock to convertible debt. However, unlike traditional funding sources, the PE firm becomes actively involved in the companies it funds through board representation and active mentoring.

Overcoming Any Misconceptions

About Private Equity

It’s a catch 22: you need funds to grow your business, but banks won’t lend the amount you need. For the business owner, and the banker whose hands are tied by strict debt-to-equity limits, the frustration is obvious. Yet your solution may be just around the corner: private equity (PE).

PE: Little Understood, But Highly Effective

Many successful smaller companies wrongly assume that PE is a source of funds only available for firms that are already large.

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This misconception arises from the industry’s history. PE grew out of the leverage buyout firms that purchased and disemboweled major conglomerates in high-profile deals during the 1980s. Other people only know the venture capital part of the industry, which received a lot of attention during the high-tech boom for funding start-up companies. In reality, neither picture is complete.

Today, Gordon Gekko and his “greed is good” mantra is long gone and the dot com boom has busted, yet PE is alive and well. This complex industry gathers private and institutional money into funds with a range of objectives, including:
- Buyout Funds
- Hedge Funds
- Venture Funds
- Growth Capital Funds
- Dedicated Capital from Wealthy Individuals
Each PE firm places its money in one or more funds to make investments in what are referred to as “portfolio companies.” The part of the PE industry that my firm focuses on is growth capital: funds that help companies grow to the next level.

PE 101
PE firms provide equity funding in return for an ownership stake. They usually invest cash in exchange for convertible preferred shares in the portfolio company.

While many firms focus on larger businesses seeking $50 million or more in funding, a number of PE firms work with growing businesses valued at $5 to $50 million and seeking as little as $2 million in funding. The funding can take many forms, ranging from common stock to convertible debt. However, unlike traditional funding sources, the PE firm becomes actively involved in the companies it funds through board representation and active mentoring.