Private equity

Lithuanian Private Equity and Venture Capital Association

What is private equity?

Private equity is a means of financing for companies with high growth potential.

This means of financing is intended for small and medium companies which receive the opportunity to expand rapidly and in a controlled way without bank loans or traditional means of financing.

Private equity investments are made in companies that are already operating as opposed to venture capital which invests in startup businesses. More about venture capital here.

Private equity investments are medium- or long-term and are usually given in exchange for a portion of the shares of the company. Companies financed under this model can expect stable operation and growth of their business. Private equity funds not only invest money but also closely cooperate with the company by appointing experienced professionals to its management team and its board of directors.

Representatives of a private equity fund work hand in hand with the company’s management team.

The company that restructures its management team and processes because of a private equity fund is able to continue growing in an assured manner even if the fund sells its share of the company. Usually, the duration of private equity investments in companies is approximately 4-7 years.

Such investments are beneficial to the economy of the whole country. Success stories make Lithuania famous and attract long-term investments from other countries as well as creating an attractive business environment.

A company with high growth potential

Venture capital seed

Bigger potential – bigger growth