Group of external advisors to a private equity group or portfolio company. Advice provided varies from overall strategy to portfolio valuation. Less formal than a Board of Directors.
Take-over transaction whereby a large part of the purchase price is covered by spinning off (non-core) assets.
A previously agreed upon point of reference or measure used to evaluate performance.
Temporary funding that will eventually be replaced by permanent capital from equity investors or debt lenders. In venture capital, a bridge is usually a short term note (6 to 12 months).
The rate at which a start-up with little or no revenue uses cash savings to cover expenses. Usually expressed on a monthly or weekly basis.
A wealthy individual who invests in entrepreneurial firms. Although angels perform many of the same functions as venture capitalists, they invest their own capital rather than that of institutional and other individual investors.
A document that describes a new concept for a business opportunity. A business plan typically includes the following sections: executive summary, market need, solution, technology, competition, marketing, management, operations and financials.
Buy and Build
An investment made in a business with the intention of acquiring further businesses in order to build the value of the original investment.
The buying back of shares by a corporation in order to reduce the number of shares on the market.
A sector of the private equity industry. Also, the purchase of a controlling interest of a company by an outside investor (in a leveraged buyout) or a management team (in a management buyout).
A tax classification of investment earnings resulting from the purchase and sale of assets. Typically, an investor prefers that investment earnings be classified as long term capital gains (held for a year or longer), which are taxed at a lower rate than ordinary income.
Capital under Management
The amount of capital available to a management team for private equity investments.
Terms a fund, that is part of a larger finance organisation or is owned by it. Opposite of an Independent Fund.
A share in the profits of a private equity fund for the management.
Cash Flow Deal
Management Buy-Out financed largely by drawing on a company's cash flow to repay borrowed capital and service debt incurred during the Buy-Out.
The conclusion of a financing round whereby all necessary legal documents are signed and capital has been transferred.
The syndication of a private equity financing round or an investment by an individual (usually general partners) alongside a private equity fund in a financing round.
Venture capital provided by [in-house investment funds of] large corporations to further their own strategic interests.
A measure of the number of potential investments that a fund reviews in any given period.
The contractual right of an investor in a company to force all other investors to agree to a specific action, such as the sale of the company.
The investigatory process performed by investors to assess the viability of a potential investment and the accuracy of the information provided by the target company.
Glossary A-D  >