Private Equity - knowing your next move

11 February 2021

Sebastian Stevens , National Leader, Private Equity
Partner, Corporate Finance

Using Private Equity (PE) should be a positive experience, especially for those doing it for the first time. That’s why BDO have created a four-part program to support businesses looking to make the most out of Private Equity.

For businesses wanting to access capital, there is often reluctance to unlock funding through private markets, particularly through Private Equity– with many citing the process as overly complex and often, misconceptions or limited understanding on how Private Equity works.

Yet, understanding the Private Equity universe and what the process entails opens opportunities for businesses to expand at speed and to step up a gear. In our experience, while Private Equity carries intricate legal, financial, tax, and behavioural considerations, they are part of a known process that can be managed with expert help.

There is also vast untapped potential in private markets in Australia, which despite the Pandemic, for venture-backed ventures – whether seed, venture, corporate venture or PE, Australia is a leading country. In fact, the Australian Investment Council reports that there are $33 Billion of Assets under management by PE and Venture Capital funds in Australia, and estimate there is $13 Billion of ‘dry powder’ available in Private Equity and Venture Capital. For the right business, there are many Private Equity funds waiting to deploy their unused capital.

At BDO, we bridge the gap between Private Equity houses and businesses by assisting with negotiations through to deal completion. Our knowledge and experience extends far beyond the financial aspects to include operational and strategic support.

With this in mind, we have created a four-part educational program: Private Equity - knowing your next move – a four-part practical series guide to help you understand the PE process to realise your business objectives. In our four part series, we help you:


Private Equity is the term used to describe a collective industry of specialised Fund Manager’s that invest in acquiring equity stakes in potentially high-growth businesses, both control and non-control positions. The ultimate goal of Private Equity is to drive transformational growth during a relatively short period, resulting in significant returns. In this brochure, we outline what Private Equity is, how it works, and key considerations to assess if Private Equity is the right investment channel for you. We outline the three drivers of value: EBITDA growth, risk mitigation and cash conversion. We also discuss one of the critical components to the success of a deal and questions you should be asking to ensure you find the right investment house.


Following on from ‘Demystify’, ‘Navigate’ offers a roadmap for this complex and time intensive investment.

In this brochure we break-down the Private Equity universe – the types of investors and their investment style. From there, we plot the four phases of the investment process, their goals, how to prepare to optimise future value and how BDO can help at each phase. This includes:

Phase 1: Exit readiness – preparing to optimise future value

Phase 2: Preparation - Focusing on value driver and ensuring quality of information

Phase 3: Marketing - Launching the sale process, marketing the business and securing offers

Phase 4: Deal completion - Final offers and deal completion


Private Equity always brings change to a business. The ‘Accelerate’ phase represents the chapter of Private Equity ownership where businesses are challenged to achieve demanding value growth. Businesses and management teams will be tasked with achieving a completely different level of sophistication and professionalism to meet the investors’ expectations. In this brochure, we define the four pillars of a strong aligned relationship: purpose of intent, execution, communication and trust. We outline the key areas of the acceleration phase where BDO can assist, outlining over 30 questions to ask yourself to assess where you may need extra support, in the areas of performance and growth, funding and financial management, governance and leadership, strategy and risk, management and financial reporting.


The capital event that marks the end of Private Equity investment should be executed in a planned, well thought-out and precise way to maximise value and minimise risk – typically beginning from day one. In the fourth brochure, we discuss planning an exit, the likely triggers and your exit options. We also detail managing the deal process at this stage, with high-level view of matters you should be considering at each stage – from transaction readiness to post transaction. Identifying the right buyer helps determine exit options, we look at the factors to be considered when identifying buyers and what aspects a potential buyer will be looking for.

While Private Equity can seem daunting, it offers an exciting and intense opportunity to super-charge growth. It achieves outperformance by accelerating value, enhancing cash conversion and reducing risk; and culminates in a profitable exit usually within three to five years.

BDO is a leading advisor to Private Equity and Venture Capital globally, making us the specialist you need to assist you on the PE journey. If you are interested in Private Equity as a source of business funding, or would like to discuss other types of funding for your business, visit our service line pages, call our Private Equity specialists, or fill out the form box below.

If you’re an entrepreneurial business owner and would like more information on Private Equity, fill out the form box below to speak to a Private Equity specialist.