What is Private Equity?

Private equity stands for all equity stake investments by private investors in promising companies not listed on a stock market. Private equity companies take part directly in the equity of the company and are an active temporary shareholder in the company. This form of investment is possible regardless of the stage a company finds itself in and is always focused on value increase. Value can be achieved in three different ways:

by improving profitability
by multiple arbitration (other valuation rules are set for smaller firms than for larger firms);
by using debt capital financing (debt leverage in order to extend the company’s own capital).

After a period of 4 to 7 years, the objectives of the investment are often reached and the equity stake is usually sold. The vast majority of private equity companies is organised in a fund structure. The capital that private equity companies manage is particularly invested by (institutional) investors such as pension funds, banks and insurers, and to a limited extent by wealthy individuals and governments. In addition to the 'captive' private equity firms that are part of a bank or insurer, there are independent private equity firms, such as Holland Venture. We independently acquire investors for our funds which have a determined lifecycle. Link to NVP website