Private equity is capital provided by private investors and private markets to companies, in exchange for an equity share in the company.
Private equity is categorised as an alternative investment class. The investments tend to be illiquid as there is no public market to buy and sell shares and positions need to held for longer periods than traditional asset classes to realise value. As a result, target returns are much higher than those of traditional investments.
Companies may use private equity to execute growth plans (expansion or acquisitions) or as part of a management buyout.
Historically, private equity has been difficult to access for private individuals, and predominantly the realm of institutional investors.
At Connection Capital we provide private investors access to private equity via investments in UK private companies. We focus on SMEs in the lower-mid market where there is less competition from buyers driving the price up.