Category Archives: Equity
In the terms of finance, secondary private equity transactions refer to selling and buying of pre-existing commitments of investors to investment funds and private equity. People who sell private equity investments not only sell the investments in funds but also the remaining unfunded commitments to these funds. Naturally, the asset class of private equity is illiquid and is meant to be long-term investment options for investors who believe in buying and holding.
It is rare to use animal imagery to describe the business activities of a firm. However in terms of looking at the issues of business equity, I feel that it is appropriate in this case to describe how a business tries to survive in the market. If the company is taken to be like a living organism, then the entrepreneur is the head, while the cells are the business equity.
General Sources of Funding
Where an entrepreneur is in a position where they either need money for starting a business or need money to extend the life of a business, there are a variety of sources of funding for such activities. Apart from business equity, the entrepreneur can finance the whole project on his or her own. This means that they enjoy all the profits but they take all the risks. Because of the high level of risk involved, some business owners are reluctant to go down this route.
Public and private ownerships represent very different packages of benefits and costs. In the public equity, the market represents a superset of all possible investors and the companies are big enough to raise the equity in the market almost any time at affordable costs. According to the experts, being a public equity gives more financial flexibility to the company, along with increased credibility in the eyes of its suppliers, employees and customers.