PRIVATE EQUITY: Equity capital that is not quoted on a public
exchange. Private equity consists of investors and funds that make investments
directly into private companies or conduct buyouts of public companies that result in
a delisting of public equity. Capital for private equity is raised from retail and
institutional investors, and can be used to fund new technologies, expand working
capital within an owned company, make acquisitions, or to strengthen a balance sheet.
The majority of private equity consists of institutional investors and accredited
investors who can commit large sums of money for long periods of time. Private equity
investments often demand long holding periods to allow for a turnaround of a
distressed company or a liquidity event such as an IPO or sale to a public company.