Post-money valuation is the sum of pre-money valuation plus proceeds received by the company from the financing. A family office is an entity established by a wealthy family to manage the assets and investments of the family. Generally speaking, a "closing" is the time in a transaction where the documents are signed and all conditions to the transaction have been fulfilled. . . ", . Secured debt is debt that is backed by specific assets of a borrower. Note that there are variations of market cap, such as fully-diluted market cap, which includes the impact of outstanding options and warrants. Bridge financing is money provided to a company by investors on a short-term basis until the company is able to raise its next round of capital. L'equity qu'est-ce que c'est ? Lorsqu'une entreprise cotée en Bourse ouvre son capital avec le public equity, tous les investisseurs potentiels sont au courant de l'opportunité. In private equity, "pipeline" refers to the deal flow that a private equity fund has. L'equity désigne les actions (parts) d'une entreprise. . The following is a glossary of terms commonly used in private equity, growth equity and venture capital. As an inducement to investors, the convertible note may convert at a discount to the valuation of the next financing round, and/or may have a valuation cap. Gross return is the return a fund obtains from its investments, deduction of management fee, expenses or carried interest. An "exit" is the act of realizing (or cashing out, or liquidating) an investment. One type of pitch is the "elevator pitch" which is a very short verbal presentation, that should take no longer than the time one would have with an investor on an elevator ride. An initial public offering, or IPO, is the first time a company sells its stock to the public. It is now common for there to be two or more "lead underwriters" on a large IPO. For more, please see my post "What are Buyouts? Another common type of acquisition is an asset purchase transaction, where the assets of a company are acquired. The term is specified in the limited partnership agreement (LPA) and is usually 7 to 10 years for the initial term. Envie d'en savoir plus ? An "early-stage financing" refers to a financing in an earl-stage company, and is usually a seed round or a Series A preferred stock round. A "strategic investor" is usually a large, established company that makes an investment in a startup or developing company for strategic purposes, such as to obtain access to the startup's technology, to understand its business model, to develop some kind of joint venture with the company, or to ultimately acquire the company.

Second, the investment period is sometimes a legal term used in a fund's limited partnership agreement ("LPA") that is defined as a period of time (usually 5 years) starting at the fund's initial closing (and sometimes from the final closing), during which the fund can make its initial investments. L'entreprise est alors accompagnée par une banque d'investissement, qui sert de souscripteur.

Over the past several years, venture capital investors have been investing in seed-stage companies, so Series A financing more broadly means the first financing round after a company's seed financing. . All rights reserved. . L'avantage du private equity pour les sociétés d'investissement est qu'il permet d'acheter une entreprise puis de la revendre à plus ou moins long terme tout en ayant remboursé une partie de l'emprunt contracté pour financer l'acquisition grâce aux bénéfices réalisés par la société. . . This usually occurs in private equity when the company has a financing event that establishes a valuation that is higher than the previous valuation, or when the company's financial and operating metrics have improved so that an increase in valuation is warranted, or when the market multiples (such as Enterprise Value to EBITDA) of publicly-traded comparable companies increase. Allen Latta's Thoughts on Private Equity, Etc. If LP-A (30%), LP-B (15%) and LP-D (10%) vote on a matter that requires the consent of a majority in interest, these 3 investors represent 55% of the committed capital and are a majority in interest.

Placement agents will help a fund prepare its marketing materials, arrange meetings with institutional investors (LPs) and manage the fundraising process to a close. . For more, please see my post ". Private equity is an umbrella term for large amounts of money raised directly from accredited individuals and institutions and pooled in a fund that invests in a range of business ventures. A "target" is a company that another entity (a company or a fund) is seeking to acquire. . Le private equity désigne l'opération par laquelle un investisseur achète des titres d'une société qui recherche des fonds propres . A "pitch" is the presentation made to persuade an investor to invest in the proposal. A "security" is any thing (in legal terms, any "instrument") that is subject to the Securities Act. One of these is chosen by the company to manage the order book for the IPO. Most venture and buyout funds usually make all initial investments in a 2-3 year time frame, after which it will make follow-on investments and raise their next fund. Dans le premier cas l'entreprise cherche à constituer ce que l'on appelle le capital social, dans le second il s'agit juste d'une augmentation du capital. C'est elle qui contribue à la commercialisation de l'offre, fixe ses prix, mais est aussi garante de toute la documentation et publication sur le marché public. There are two types of claw-backs, a GP claw-back relating to carried interest, and an LP claw-back relating to distributions received by LPs. Link: . In this case, the buyer is paid a "break-up fee" which is intended to compensate the buyer for its time of evaluating and negotiating the deal and for costs and expenses it has incurred. The "vintage year" of a fund is the year that a fund "begins." An incubator is an organization that provides start-up companies with free or low-cost office space, resources, mentoring, and introductions to potential customers, vendors, strategic partners and investors. To me, it is most similar to a warrant. . . A "trade sale" occurs when a company (such as a portfolio company of a private equity firm) is sold to another operating company which is in the same or a related industry or sector. . financings refer to institutional financing rounds after the Series A round.

A "take-private" transaction is one where a buyout fund acquires a publicly-traded company and de-lists the company from the stock exchange that trades its shares.

Equity is basic ownership in a company, usually in the form of stock (common stock or preferred stock) or in an instrument that converts into equity (stock options, warrants, convertible debt and SAFEs). A "stock option plan" is an equity incentive plan adopted by a company to offer its officers, directors, employees and advisors stock options as an incentive for their performance of services to the company.

Gross IRR is the return a fund receives on its portfolio investments, and does not take into account (gross of) management fees, carried interest and fund expenses.