A Deeper Look at Private Equity - EP.09

Today, we take a deeper dive into looking at private equity.
Private equity is Grayson’s world — so we switch the script and I
ask him all of the questions I have about private equity.


We discuss how private equity can help grow businesses, get debt
to help your returns, the high risk/high return nature of private
equity, precise strategies, what to look for when you’re
investing, how to know how much to invest, and more! 


Key Takeaways:


[:13] About today’s episode.


[:44] An overview about private equity, how Grayson defines it,
and what sort of businesses he goes after.


[2:29] How do you grow the company with private equity?


[4:04] Are there any precise strategies that focus on particular
markets in private equity firms?


[4:48] Who are the big private equity firms?


[5:30] Do smaller private equity firms do one-off deals in
addition to funds (similarly to real estate)?


[6:28] Why does private equity have higher return (and in turn, a
higher risk)?


[7:59] Can you get debt in private equity?


[9:12] High leverage, big buyout vs. the smaller deals.


[10:40] Multiple expansion and why it’s so great.


[12:41] What to look for when you’re investing in private equity.


[17:44] How do you know how much to invest?


[19:09] How do you pay a multiple on revenue?


[23:40] In an auction process on a deal, what would the
variability between lowest bid and top bid be?


[24:50] A real world example of a private equity deal.


[29:06] What about exits? How do you make the most money in these
deals?


Mentioned in this Episode:


KKR


Blackstone


Apollo


The Carlyle Group


Fortress


EBITDA 


For More on The Alternative Investor, Check Out:


TheAlternativeInvestorShow.com


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