Private equity is an alternative asset class and consists of capital that is not listed on a stock exchange.
Private equity is composed of funds and investors who invest directly in private companies or buy-outs of public companies, which leads to the delisting of public equity.
Institutional and private investors provide the capital for private equity, which can be used to finance new technologies, make acquisitions, expand working capital and strengthen and consolidate the balance sheet.
Private equity investments come mainly from institutional and accredited investors who can provide substantial amounts of money over a long period of time, and in most cases private equity investments require significantly long holding periods to ensure a turnaround for distressed companies or to facilitate liquidity events such as an IPO or sale to a public company.