What is Private Equity?
The private equity firms are professional investors (better known as GPs) who invest in high growth potential companies. These groups of GPs take equity positions in companies that they actively promote. They also participate in managing businesses and make them more productive, which allows them to grow faster.
GPs are temporary investors in companies for a period between 3 and 7 years. This enables the GP to transfer its knowledge and best practices to the company that receives the capital, to strengthen their practices and improve their competitiveness.
The private equity firms do not provide credits. They invest in companies which are in various stages of growth, of different sizes and that operate in several sectors.
There are GPs that focus on promoting early-stage businesses, best known as seed capital or venture capital funds. In Mexico there are also private equity firms that invest in growth stage companies or expansion, as well as those that focus on the sectors of real estate and infrastructure.
Learn about the impact of private equity in Mexican companies by reading the study developed in collaboration with KPMG Mexico: View Document.