Venture Capital, Private Equity, and the Financing of Entrepreneurship

In the newly revised second edition of Venture Capital, Private Equity, and the Financing of Entrepreneurship, a dedicated team of researchers and professionals delivers an authoritative and comprehensive account of the world of active investing. This important work demonstrates how venture capitalists and private equity investors do business and create value for entrepreneurs, shareholders, and other stakeholders.

The authors, drawing on decades of combined experience studying and participating in the private equity markets, discuss the players, dynamics, and the incentives that drive the industry. They also describe various possibilities for the future development of private equity. This latest edition is perfect for advanced undergraduate students of finance and business, as well as MBA students seeking an insightful and accessible textbook describing the private equity markets.

Preface vii

Acknowledgments ix

About the Authors xi

1. Introduction 1

2. The Private Equity Cycle—Fundraising and Fund Choosing 20

3. Deal Sourcing and Evaluation—Not as Easy as It Looks! 65

4. Assigning Value 101

5. Deal Structuring—Private Equity Securities and Their Motivation 131

6. After the Money Arrives 175

7. Getting Liquid: Exits and Distributions 204

8. The Globalization of Venture Capital and Private Equity 246

9. Risk and Return 285

10. The Impact of Private Equity on Society—Does This Really Matter Anyway? 313

11. People, Positions, and Culture: The Management of the Private Equity Firm 345

12. Scaling and Institutionalization 374

13. Boom and Bust 404

14. Wrapping Up 435

Glossary G-1

Index I-1

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