What is Private Equity?

Private equity involves investing in unlisted companies and entrusting the management of these investments to specialized fund managers. These professionals select high-potential companies, often operating in growth markets and led by experienced management teams. The goal of private equity is to generate long-term returns by actively supporting the companies’ development. Unlike public markets, where executives face pressure to deliver short-term performance, teams backed by private equity funds have a five- to seven-year horizon to execute their strategy and transform their companies. This approach allows for the implementation of more ambitious value creation plans, based on growth, innovation, and operational improvement. Private equity thus forms part of an investment strategy in the real economy, financing the development of companies at various stages of maturity. Many companies that are well-known today have benefited from private equity support at different stages of their development, illustrating the role of this asset class in fostering growth and innovation.