About the Book

This second edition of Introduction to Private Equity is more than an update, it reflects the dramatic changes which have affected an industry which is evolving rapidly, internationalizing and maturing fast. What is recognized as a critical yet grounded guide to the private equity industry blends academic rigour with practical experience. It provides a clear, synthetic and critical perspective of the industry from a professional who has worked at many levels within the industry; including insurance, funds of funds, funds and portfolio companies. The book approaches the private equity sector top-down, to provide a sense of its evolution and how the current situation has been built.

About the Author

Cyril Demaria is an Associate Professor of Finance at ESSCA (France and Budapest), at the Université Catholique de Paris, in France and at EADA, Barcelona, where he teaches Private Equity, LBO, Money and Finance and International Finance. He has also held positions as a portfolio equity manager at Maaf Gestion, where he managed assets in excess of $60 Million.

Table of Contents:
Foreword to the Second Edition Acknowledgements About the Author Introduction 0.1 A Moving Target 0.2 A Consubstantial Lack of Information 0.3 Benign Neglect, Malign Consequences 0.4 Knowing the Devil to Circumvent it Part I What is Private Equity? 1 Private Equity as an Economic Driver: An Historical Perspective 1.1 Pooling Interests to Identify and Exploit Sources of Wealth 1.2 Championing Entrepreneurship 1.3 Conclusion: An Attempt at Definition 2 Modern Private Equity -- A French Invention? 2.1 USA: The Foundry of Modern Private Equity 2.2 Europe: Adapting a Successful Model or Creating its Own? 2.3 Conclusion: Emerging Markets, Building Castles on Sand? Part II The Private Equity Ecosystem 3 Private Equity: A Business System Perspective 3.1 We are All Investors in Private Equity 3.2 Organisation and Governance of Private Equity Funds 3.3 Measuring Performance, Managing Risks and Optimizing Returns 3.4 Pitfalls and Challenges 3.5 Conclusion 4 The Universe of Investment 4.1 Venture Capital: Financing Company Creation 4.2 Growth Capital: Financing Companies' Expansion 4.3 Leveraged Buy-Out: Financing Companies' Transmissions 4.4 Other Interventions in Private Equity 4.5 Conclusion 5 The Process of Investment: A Matter of Trust and Mutual Interest 5.1 Step 1: Preliminary Analysis 5.2 Step 2: Valuation 5.3 Step 3: Negotiating 5.4 Step 4: Structuring 5.5 Step 5: Complementary Due Diligence 5.6 Step 6: Transaction 5.7 Step 7: Monitoring and Exit 5.8 Conclusion Part III Private Equity in Teenage Time: Trend Setting, Fads and Responsibilities 6 Private Equity Evolution: Trends or Buzzes? 6.1 Is Private Equity Going Mainstream? 6.2 Is Private Equity (Still) Creating Value? 6.3 Private Equity: Between Bubbles and Crashes 6.4 Conclusion 7 Private Equity and Ethics: A Culture Clash 7.1 Greed 7.2 Destruction 7.3 Philanthropy 7.4 Transparency 7.5 Self-Regulation or Imposed Regulation? 7.6 Conclusion 8 General Conclusion -- Private Equity Today and Tomorrow 8.1 Fewer General Partners, but not Necessarily Better Ones 8.2 Core Target: Manage the Volatility of Performance 8.3 The Only Valid Leitmotiv: Long-Term Thinking 8.4 The Impact of Fair Market Value 8.5 A Long-Term Trend: The Attractiveness of Private Equity 8.6 Private Equity: Future Victim of its Own Success? 8.7 The Impact of a Better Knowledge of Private Equity Template 1 (Fund) Architecture of the Private Placement Memorandum of a Private Equity Fund Template 2 (Fund) Structure of a Limited Partnership Agreement Template 3 (Fund) Due Diligence Checklist Template 4 (Fund) Quarterly Report Template Template 5 (Company) Non-Disclosure Agreement Template 6 (Company) Business Plan Template 7 (Company) Term-Sheet Business Case: Kroton Educacional SA -- A Private Equity Operation Can Hide Another One Exhibits Glossary Bibliography Index