Private Equity Market: Overview, Trends, and Future Outlook
What Is Private Equity?
Private equity (PE) refers to investment funds that acquire equity ownership in private companies or take public companies private. PE firms typically aim to enhance the value of these companies over time through strategic, operational, or financial improvements, before eventually exiting via sales, mergers, or public offerings. The market encompasses venture capital, growth capital, leveraged buyouts (LBOs), and mezzanine financing.
Market Size and Growth
The private equity market has grown substantially over the past decade, fueled by increased capital inflows from institutional investors, high-net-worth individuals, and sovereign wealth funds. The market continues to expand due to global economic growth, rising entrepreneurship, and increasing demand for alternative investment options that provide higher returns compared to traditional equity and debt markets.