Private Equity (PE) is about more than funding, it provides an opportunity to transform your business.

Demystify, the first in our four-part series, explores how PE investors typically aim to double, or even triple, the value of their investment over a three to five-year period. But how do they do it?

In this guide, we’ll explain:

  • What Private Equity is and how it works
  • How PE funds are structured and what PE investors look for
  • Key concepts like carried interest and sweet equity
  • How PE houses evaluate businesses and drive value
  • Questions to ask before deciding if PE is right for you.

Who is this guide for?

If you're exploring PE for the first time, this guide is for you.

Whether you're a founder, business owner or part of a leadership team curious about how PE works, Demystify offers a clear introduction to the fundamentals, packed with practical advice, real-world examples and clear explanations. It’s ideal for businesses considering external investment but unsure where to start.

Download the full guide to explore how PE could unlock your next phase of growth.

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If your PE journey is more advanced, you may find our other guides helpful.

Good governance guide

Demystify

Understand what private equity is, how it works, and whether it's right for your business.

Who is this guide for? 
Those exploring PE for the first time.

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Key insights from the guide

What PE houses look for

PE houses look for businesses with strong cash conversion, healthy margins, low risk, and high growth potential.

When aligned, These four factors can significantly increase your valuation and attractiveness to investors.

What is sweet equity?

Sweet equity is the portion of ownership retained by management that can deliver outsized returns if the business performs well.

It’s a powerful incentive, but it comes with expectations around performance, reporting and alignment.

Start your private equity journey with an experienced partner like BDO

If you have questions about private equity, or you’d like to speak with someone about your specific goals, challenges or opportunities, our private equity specialists are here to help.

Contact our team to start the conversation and find out how BDO can support your next chapter.

Authors

Greg Ellis smiles at the camera
National Leader, Private Equity
Partner, Deal Advisory