PE firms vs pool of individual investors

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October 09, 2021

by a searcher from Imperial College London - Imperial College Business School in Sydney NSW, Australia

I would love to hear from anyone who has explored the option of having as deal investors a couple of PE firms, each having a minority stake, vs. the more common pool of 10+ individual investors. .Any pitfalls to watch out for?

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Reply by a searcher
from Massachusetts Institute of Technology in Los Angeles, CA, USA
Agree with ^redacted‌. The size of the deal has to be very large to get several PE firms involved - they all have minimum investment criteria...and then you will need to have several complicated conversations on who is on the board etc.
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Reply by a searcher
from New York University in Nashville, TN, USA
JP, the biggest question for me has always been cost of capital (whether it comes in expected IRRs or control). I'd suggest the cheaper cost is always better, depending on the type of investor you can negotiate with. Happy to have a conversation directly.
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