Private equity is one of the main ways investors gain exposure to privately held companies. It has historically delivered better long-term risk-adjusted returns than public equity1, achieving this primarily by making operational improvements across portfolio companies, with the aim of growing revenues and expanding margins.
The path to growth within private equity is primarily driven by three factors:
• A Long-Term Growth Perspective – Private equity is designed to capitalize on long-term changes to strategies, operations, capital allocations and management.
• An Expanded Opportunity Set – A wider set of investible companies than is available in public markets.
• A More Efficient Equity Exposure – Returns driven by company-level fundamentals, proprietary informational advantages and control of value creation.