Finding Investment Opportunities

Private equity is an alternative investment class and generally consists of capital not listed on a public exchange. Private equity is composed of funds and investors that directly invest in private companies, or that engage in buyouts of public companies, resulting in the delisting of public equity. Institutional and retail investors provide the capital for private equity, and the capital can be utilized to fund new technology, make acquisitions, expand working capital, and bolster and solidify a balance sheet.
A private equity fund has Limited Partners (LP), who typically have limited liability, and General Partners (GP), who have full liability. The latter is also responsible for executing and operating the investments.
Generally speaking, most Private Equity firms invest resources into organizations that have previously acquired footing in their particular business and market sectors, yet need extra cash flow to arrive at a higher level. Since the firm investor doesn’t normally hold a majority stake, the investor holds less influence over the vital and functional bearing of the portfolio company. Therefore, the three components are basic for the financial backer to assist with guaranteeing positive speculation results which are increased focus on partnership, alignment of interest and value-added opportunities and expertise.

An angel investor (also known as a private investor, seed investor or angel funder) is generally a high-net-worth individual or small investment fund, who provides investment backing to small startups typically in exchange for an ownership stake in the company. Often, angel investors are found among an entrepreneur’s family and friends. The funds that angel investors provide may be a one-time investment to help the business get off the ground or an ongoing injection to support and carry the company through its difficult early stages. The risk-reward ratio for such Investors is generally the highest among all relevant categories given the stage of the business and accordingly lower valuations. Although not everyone will want to dedicate the time and energy required to be an active angel investor, for those that do Kennis serves to support the investors with their expertise in finding investment opportunities, as the benefits offer a payoff, unlike any other investment opportunity.

Venture capital (VC) is just another form of private equity, wherein investors generally invest in startup companies and small businesses that have proven business metrics and are believed to have long-term growth potential. Similar to Private Equity Funds, Venture Capital Funds have their own Limited Partners and have a higher risk appetite as compared to a Private Equity Fund. Generally, such Investors also bring in technical or managerial expertise in addition to monetary resources. Venture capital is typically allocated to small companies with exceptional growth potential, or to companies that have grown quickly and appear poised to continue to expand.

Strategic Investments are typical investments by a business in another business which compliments the growth of the Investor’s business. Such investments could be about acquiring a significant minority or majority stake in the Investee Company and may provide an advantage of backward or forward integration or linear expansion of the existing product line of the Investor Company. In strategic Investments, the expectation of Investors is considerably more than just making financial returns. Here, the Investor is generally looking to stay for a much longer period unlike other investment forms wherein the Investors enter the business with a defined time horizon. At the same time, the Investor understands the business well-being from the same field and brings in considerable value add in the form of knowledge, experience and expertise in addition to the required financial investment.