Private Market Structural Challenges

 

Transactional Friction and Liquidity

Prof. Aswath Damodaran, widely cited valuation expert from NYU’s Stern School of Business, makes the assertion that regardless of business type, private companies suffer from a 20-30% valuation discount due to the illiquidity of the private equities market. While this discount level generally applies to formal valuations (such as those determined when raising capital), owners of illiquid private securities often Read More…

Capital Markets are Evolving

 

The Private Capital Shift
While the structural opportunities appear largely the same, the underlying dynamics of the global capital market are evolving. We see this manifested in the global decrease in mid to small cap securities offerings and the growth of the $1bill+ megadeals. From peak to trough, the current US market has seen a dramatic reduction (81%) in the number of IPO’s per year when compared to the mid 1990’s. Read More…