Private Equity (PE) is a form of equity capital investment made into companies that are not publicly traded on a stock exchange. It is an asset class focused on long-term value creation through active ownership and operational improvement.
PE firms raise money from large institutional investors and high-net-worth individuals to create funds, which are then used to acquire stakes, often controlling stakes, in private companies.
PE firms, known as the General Partners (GPs), raise capital from institutional investors such as pension funds, endowments, and insurance companies, known as Limited Partners (LPs). The capital is committed to a private equity fund, typically with a lifespan of 10 years or more.The fund uses the pooled capital, often combined with a significant amount of borrowed debt (especially in Leveraged Buyouts), to acquire equity in target companies.






