The Rise of Public Private Equity

While public private equity might seem more than a little contradictory, it is apparently imminent. Private equity firms are under immense pressure from brokerages to take themselves public, and most are forecasting at least a few firms will do it this year.

Of course, cynics like me would say that when partners in private equity firms can make more money selling their shares to you and me, than by holdings those shares and earnings returns from carry, then it’s probably a bad time to be buying private equity IPOs. But hey, that’s just me.

Related posts:

  1. Collusion in Private Equity
  2. The Private Equity Boomlet
  3. Zen and the Public Company
  4. The Brain Drain — to Private Equity
  5. Festishistic U.K. Fascination with Private Equity

Comments

  1. drew says:

    I can well imagine the pressure and appeal to investors (read senior partners) who are thinking about moving on. And maybe more junior partners will feel better about having the “price” of their stake in partnership valued in a more objective manner. But, if we enter a down cycle for PE/VC, surely there will be great disappointment with partners bailing out if funds go underwater.
    Operationally, there would seem to be little benefit from this. The independence from quarterly reporting would be mostly lost. And management teams participating in a buyout might regard the PE firm as no more attractive than any holding company without being sheltered from public market pressures and without the potential profit down the road from a private to public transition. (One might argue that the latter is at the expense of selling shareholders but it’s a benefit management often can get).