Introduction to Private Equity: Venture, Growth, LBO and Turn-Around Capital, 2nd Edition

Glossary

A

Accredited investor   An investor declared as sufficiently informed and sophisticated, who benefits from a satisfactory knowledge of investments and is thus able to handle private equity investments, which do not benefit from the protection offered by the stock exchange regulations.

Acquisition   The take-over of a portfolio company by another industrial or financial company.

Angel investor   A high net worth individual who invests in private equity to help companies and let them benefit from his experience, his network and his know-how. Also called business angel.

Assets under management   The sum of all the assets managed (that is to say those available for investment and those already invested) by an investment team in private equity deals.

B

Balance sheet   The picture of the financial situation of a company at a given time. The balance sheet is the synthesis of the value of assets, debts and capital of the company.

Balanced fund   An investment strategy in private equity designed to build a portfolio of companies at different stages of development (venture capital, growth capital, leveraged buy-out).

Blocker   See ‘Feeder fund’.

Book value   See ‘Historical cost’.

Bridge finance   Short-term financing generally provided to a company expecting a financing event (IPO or further round of financing) in the coming six to 12 months. The bridge financing round usually combines debt and equity features. The shares or debt instruments are then generally converted at the ...