Private Equity 101
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Private Capital, Private Equity & Private Debt
Fund accounting, Fund administration, Fund raise
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T. Rowe Price Group plans to acquire a New York-based investment firm for $4.2 billion, making its first big expansion into private markets in a bid to grow beyond its better-known mutual fund retirement business.

In its largest-ever acquisition, the Baltimore-based money management firm has agreed to acquire 100% of the equity of Oak Hill Advisors. The alternative credit manager has $53 billion of capital under management and more than 300 employees worldwide.
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The market for secondhand stakes in private-markets assets is expected to hit a milestone this year, as strong investment performance has encouraged more institutional investors and fund managers to explore sales.

Buyers and intermediaries say this year they expect total secondary transaction volume to reach, if not exceed, $100 billion for the first time ever, as the market enters what has historically been its busiest quarter.
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Private assets are assets held in investments that are not publicly traded. This includes investments with private equity and privately managed equity real estate funds, among others. 

According to the Securities and Exchange Commission (SEC), an asset is “any tangible or intangible item that has value in an exchange. A bank account, a home, or shares of stock are all examples of assets.” 

Private investments are not publicly traded and there are fewer regulations than with the traditional asset classes, stocks, bonds, and cash. Because of this, assets from private investments are usually considered alternative investments. 

A few of the most common private asset investment types are: 

Private Equity 

Private equity investments are not traded on public markets and are usually pursued by accredited investors or high-net-worth individuals. Private equity firms usually acquire or invest in private companies with the aim to take them public or sell them for a profit. Because assets from private equity investments are not with a public company, it is considered a private asset. 


Real Estate


Real estate assets are usually considered private assets. An example of a real estate private asset is investing in a Real Estate Investment Trust (REIT). In a REIT an investor purchases shares in the trust that owns real estate that seeks to produce income. 

Infrastructure 

Privately managed infrastructure funds are an example of a private asset class. Examples include investments in energy and telecommunications. 

Private Credit 

Private credit is an alternative asset class where investments are made into non-publicly held debt and direct or private lending companies. 

Private assets and investments can be complicated, and it is best to consult with a financial advisor to understand each investment fully. 
Example Of Secondary VC Fund

Venture capital isn’t for everyone. Most startups fail, and most investments return zero. Many VC funds don’t make any distributions in the first 5 years, and most of them take 10-15 years or longer to fully exit. The lack of predictability and a long period of illiquidity makes venture capital a challenging asset class for all but the most patient of investors.

That said, top VC funds can perform far better than the rest of the market, and the best tech companies can turn into unicorns that generate 20x, 50x, or sometimes even 100x returns.

If only there was a way to skip ahead five or more years and invest in just the VC funds that are doing well, wouldn’t that be great? 

What if you could arrive at the game at halftime and bet on the team that was already ahead by 10 points? And what if you could buy that winning ticket at a discount?

It’s possible. Enter Practical Venture Capital… 

Practical Venture Capital (PVC) is a Silicon Valley VC firm that buys secondary interests in mature, top-performing early-stage VC funds and companies. The co-founders and managing partners are Dave McClure and Aman Verjee, experienced investors and internet startup veterans who have worked at PayPal, eBay, Sonos, Founders Fund and 500 Startups. They have been early investors in 30+ unicorns and 8 IPOs that have generated 50-100x+ returns including Credit Karma, Twilio, SendGrid, Lyft, TalkDesk, Canva, among others. 

Venture Capital Secondary combines the rapid growth of tech companies with faster liquidity. PVC acquires secondary interests in top-performing VC funds and portfolio companies from LPs and GPs who want early liquidity, typically purchasing these assets at a 20-40% discount to NAV. 
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