PE/VC funds typically invest in companies that are still not listed on the stock exchanges. This gives them a larger universe of companies to tap into. By investing in companies before they list, PE funds unlock greater value for their investments.
PE/VC funds are ideal for high-net-worth investors* who have the risk appetite to invest in early or mid-stage companies. These funds also typically have a high minimum investment size.
*The minimum investment range is Rs. 1-5 crore
Upside: The earlier you catch a company in its lifecycle, the greater the value you can unlock from your investment. PE funds offer you an opportunity to get in early. If the PE fund’s investments turn successful, the rewards can be exceptional, but be prepared for risks too.
Diversification: If you already have a well-diversified portfolio in the listed universe, then PE funds can give you diversification into a horde of great ideas that are yet to list.
Fund the future: Many entrepreneurs and business owners put their money into PE funds to encourage new entrepreneurs who are pushing the envelope. PE funds give you the opportunity to invest in the innovators of today who may be the unicorns of tomorrow.
We closely screen the PE/VC universe and offer you an easy way to invest in funds that have a solid track record and are backed by a robust investment framework.
FACTBOX
Investments in equity or a company that is not publicly listed are called private equity investments. Private equity investments are facilitated by private equity firms, which typically raise funds from a pool of investors.
Private equity firms invest in unlisted companies (pre-IPO firms, startups or mature firms) in exchange for equity. These firms raise money from institutional investors, affluent families, or high-net-worth individuals. Private equity firms work with investee companies to ensure they grow their valuations and they reap returns when the company is acquired or is publicly listed.
Venture capital firms invest in startups that look promising in exchange for equity. They typically invest in companies that have the potential to grow fast.
As mentioned earlier, venture capital firms invest in startups with high growth potential. Venture capital firms help startups find early funding and hope to find exits when these firms are acquired by larger companies, or by getting in investments at higher valuations, or when the companies go public.
