Investments in Private Capital: Equity and DebtLocked: included in All Access

Private capital is money for companies raised outside public markets and banks: private equity (buyouts, venture capital, growth equity, PIPEs) and private debt (direct lending, venture debt, mezzanine, distressed, unitranche and specialty loans). This module explains how each works across the corporate life cycle, how private equity funds exit, what drives the risk and return of private equity and private debt, and what diversification benefit private capital adds to a portfolio of public stocks and bonds.

1. 1. Private equity: buyouts, growth equity and PIPEsPrivate equity buys large or controlling stakes in companies outside the public market, then uses control, operating changes and often heavy leverage to raise the company's value before selling it.Locked: included in All Access14 min
2. 2. Venture capital and the corporate life cycleVenture capital funds young, high-growth companies in stages from idea to pre-IPO; the earlier the stage, the higher the risk and the return investors demand, and convertible preferred shares protect them on the way.Locked: included in All Access13 min
3. 3. Private equity exits and risk-returnPrivate equity makes its money at the exit, by trade sale, IPO, direct listing, SPAC, secondary sale or recapitalisation, and its return comes with extra illiquidity and leverage risk that published indexes tend to understate.Locked: included in All Access15 min
4. 4. Private debt: the main categoriesPrivate debt is lending by investors directly to companies, ranging from senior secured direct loans and unitranche facilities through mezzanine and venture debt to distressed and specialty lending, each matched to a stage of the life cycle.Locked: included in All Access14 min
5. 5. Risk and return of private debtPrivate debt can pay more than traditional bonds, through an illiquidity premium and opportunistic lending, but it carries more default and illiquidity risk, needs specialised knowledge, and its smooth reported returns hide part of that risk.Locked: included in All Access11 min
6. 6. Diversification benefits, vintage years and the risk-return ladderPrivate capital adds a moderate diversification benefit to public stocks and bonds, venture capital the most; because results depend so much on when a fund starts investing, investors should spread commitments across vintage years.Locked: included in All Access13 min