It also made these investments everywhere -from North America to Europe and Southeast Asia. It backed up the hypothesis that Blackstone made about e-commerce (further backed by investing in actual e-commerce companies). The acquisition was typical of large private equity deals. It said at the time:“Logistics remains among our highest conviction global investment themes and we continue to see strong momentum driven by e-commerce trends.” It also meant Blackstone’s logistics empire in China expanded to 23 cities. In acquiring the $1.1 billion share of the park, Blackstone increased its portfolio by approximately a third. In 2020, Blackstone acquired a majority stake in the largest logistics park in Guangzhou in China.
Private equity vs venture capital driver#
One of its big plays for the past decade has been logistics: More consumption and particularly, more online retail, will be a big demand driver for logistics capabilities, Blackstone believes. The world’s biggest private equity company, measured by assets under management (AUM), is the Blackstone Group.īlackstone hires teams of highly skilled economics and analysts to generate macroeconomic hypotheses, which it then puts into action in its acquisition strategies. Less liquidity: Closely related to the above, private equity investments are not always easily liquidated and sometimes there may be penalties for doing so earlier than agreed.Longer investment horizons: Investors may have to wait several years before seeing are turn on their investment, unlike with investments in stock market companies.
/thinkstockphotos-166162153-5bfc2b5746e0fb0083c0735f.jpg "private equity vs venture capital")
Victim of its own success: The returns generated by private equity over the past two decades have far more money into the industry, meaning good opportunities are increasingly difficult to find.Larger universe of investments: The universe of publicly listed companies is only a fraction of the size of that for private companies, meaning private equity investors - in theory at least - have more to choose from.Less red-tape: By investing in private companies and assets, private equity companies can avoid most of the regulatory hurdles that exist for publicly listed companies.Experienced investors: Private equity companies are most often established by former investment bankers with well developed dealmaking skills, and proven track records.
Advantages and Disadvantages of Private Equity Advantages: location, industry/industries, profitability, size, structure) that the private equity fund aims to invest in, thereby allowing its own investors the opportunity to see whether that hypothesis fits with their personal investment philosophy. An investment hypothesis outlines the kind of company (i.e. An investment hypotheses is an important feature of private equity companies, which rarely make opportunistic acquisitions.
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