private-equity

Vocabulary Word

Definition

'Private equity' is money invested in businesses that are not publicly traded on the stock market. This money is used to buy the business, make improvements to it, and then sell it with the aim of making a profit.

Examples in Different Contexts

In financial strategies, 'private equity' is used as a means for investors to gain equity in promising companies outside of the public stock market. A financial strategist might note, 'Investing in private equity offers the potential for significant returns, albeit with higher risk and longer investment horizons.'

Practice Scenarios

Tech

Scenario:

Our platform is showing promising user engagement stats. Perhaps we need to act on this opportunity to secure additional funding.

Response:

Yes, we should present our growth metrics to potential private equity investors to secure more funding.

Startup

Scenario:

Our latest product launch was successful, and the market response has been positive. We should explore funding opportunities to accelerate our growth plans.

Response:

I agree; the right private equity partner could offer both the capital and mentorship we need to scale our business.