Question

In: Finance

Describe the typical organization of a private equity firm. What are the main motivating factors that...

Describe the typical organization of a private equity firm. What are the main motivating factors that result in this type of organization?

What are the three main traits required of an analyst? What are the keys to promotion for an analyst?

How does the associate job differ from the analyst job? What are the keys to promotion for an associate?

How does the principal job differ from the associate job? What are the keys to promotion for a principal?

What are venture partners and operating partners? What are their roles in a private equity firm?

Solutions

Expert Solution

ORGANIZATION OF A PRIVATE EQUITY FIRM:

  • MADE UP OF LIMITED PARTNERS AND GENERAL PARTNERS.
  • LIMITED PARTNERS ARE OUTSIDE INVESTORS AND GENERAL PARTNERS ARE PROFESSIONAL INVESTORS
  • LIMITED PARTNERS PROVIDE CAPITAL AND GENERAL PARTNERS MANAGE AND POOL THIS INVESTMENT TO PRIVATE EQUITY FIRM.
  • LIMITED PARTNERS LIABILITY IS LIMITED TO THE EXTEND OF THEIR CAPITAL CONTRIBUTION.

MOTVATING FACTOR FOR PRIVATE EQUITY FIRM:

  • POSITIVE RERURN ON INVESTMENT
  • LOW RISK
  • LOW PROFESSIONAL INSECURITY

THREE MAIN TRAITS OF AN ANALYST:

  • BRINGING INNOVATIVE IDEAS
  • PROJECT SUCCESS.
  • SAVE MONEY AND TIME OF THE ORGANISATION.
  • EXECUTE REQUIREMENTS PERFECTLY.

DIFFERENCE BETWEEN ASSOCIATE JOBS FROM ANALYSTS JOB:

  • ASSOCIATE JOB IS ONE POSITION HIGHER THAN ANALYST JOB
  • ANALYST ANALYSES TRANSACTION WHEREAS ASSOCIATE JOB IS MIDDLE LEVEL OF OPERATION.
  • ASSOCIATE CHECK THE WORK OF ANALYST.
  • THE MAIN AREA OF WORK OF ANALYST IS PROJECT RELATED WHEREAS WORK OF AN ASSOCIATE INCLUDES CREATING AND BUILDING FINANCIAL MODELS AND VALUATIONS.

KEYS TO PROMOTION OF AN ASSOCIATE:

  • COMPLETION OF PROJECT
  • SMOOTH RUNNING OF ORGANISATION
  • INCREASED OPERATIONAL PERFORMANCE OF COMPANY.
  • TRUST ON MODELS PREPARED BY ASSOCIATE IN LONG RUN.

DIFFERENCE BETWEEN PRINCIPAL JOB AND ASSOCIATE JOB:

  • PRINCIPAL ENGAGED IN MORE THAN NE JOB AT A TIME WHEREAS ASSOCIATE CONCENTRATE ON ONE JOB
  • PRINCIPAL IS HIGHER IN RANK THAN ASSOCIATE.
  • USUALLY TAKES 2-4 YEARS FOR AN ASSOCIATE TO BECOME PRINCIPAL.
  • PRINCIPAL MANAGE THEIR SENIOR CLIAENT RELATIONSHIP.
  • MANAGE DAY TO DAY AFFAIRS.
  • PRINCIPAL REVIEW OUTPUT AND PROVIDE FEEDBACK
  • ATTENDING MEETING AS A REPRESENTATIVE

KEY TO PROMOTION OF A PRINCIPAL:

  • PROBLEM SOLVING CAPABILITY
  • SKILLED KNOWLEDGE
  • APPLICATION OF KNOWLEDGE

VENTURE PARTENRS AND OPERATING PARTNERS:

  • VENTURE PARTNERS ARE LIMITED PARTNERS AND OPERATING PARTNERS ARE ENEGAGED ARE GENERAL PARTNERS IN A PRIVATE EQUITY FIRM.

ROLE:

  • VENTURE PARTNERS PROVIDE CAPITAL.
  • OPERATING PARTNERS MANAGE AND POOL THIS INVESTMENT TO PRIVATE EQUITY FIRM.

Related Solutions

Describe the typical organization of a private equity firm. What are the main motivating factors that...
Describe the typical organization of a private equity firm. What are the main motivating factors that result in this type of organization? What are the three main traits required of an analyst? What are the keys to promotion for an analyst? How does the associate job differ from the analyst job? What are the keys to promotion for an associate? How does the principal job differ from the associate job? What are the keys to promotion for a principal? What...
What are health risks typical within the Filipinos? Describe motivating socio-cultural factors that influence risk and...
What are health risks typical within the Filipinos? Describe motivating socio-cultural factors that influence risk and why someone might engage in “risky behaviors” to gain something deemed more important (e.g. gender, status, economic need, moral code). Include any “rites of passage” that might apply that places people from your culture at risk (e.g. initiation into manhood or womanhood (i.e. genital cutting), marriage, and so on.
In terms of the factors motivating a firm entering into an M&A, which of the following...
In terms of the factors motivating a firm entering into an M&A, which of the following is true? a. Smaller firms are more willing to pursue an M&A because it limits their financial exposure. b. In high-risk environments, firms are less likely to want to commit resources necessary for an M&A. c. Managers like M&As in entering developing countries if the systematic country risk is high. d. M&As are a good way to test a new market and to see...
What factors in a company, organization or firm control that will influence the WACC? What factors...
What factors in a company, organization or firm control that will influence the WACC? What factors that is beyond an organization, company, or firms control will effect the WACC? Which plays a more significant role. Provide real life example
- Explain the main motivating factors behind The Protestant Reformation. Please include Martin Luther's criticisms of...
- Explain the main motivating factors behind The Protestant Reformation. Please include Martin Luther's criticisms of the Catholic Church, and John Calvin's ideas during this time.
What is the importance of motivating employees? Discuss the personal and contextual factors that have an...
What is the importance of motivating employees? Discuss the personal and contextual factors that have an impact on motivation. How might managers leverage these factors or combat them is they become an obstacle? What role does offering rewards play in motivating employees? Are they always helpful? human resource
Consider a typical electronic device manufacturing Organization: a) Describe Sales Cycle in such an organization in...
Consider a typical electronic device manufacturing Organization: a) Describe Sales Cycle in such an organization in terms of transaction processing . • Identify at least three pieces of information required between each sequential pair of transactions (activities of the cycle) IMPORTANT********Note: You also use a diagram to list the activities and the information passed between activities.*********
If x1 and x2 are the factors of production of a typical firm, output price is...
If x1 and x2 are the factors of production of a typical firm, output price is p, price of x1 and x2 are w1 and w2, respectively and the firm’s production function is:            f (x1, x2) = x1^3 x2^3 i. Write up firm’s short run and long run profit maximization problem. Show firm’s short run profit maximization graphically please. ii. Using the information above can you write the cost minimization problem for this firm if the firm decides to produce...
Define an Unconditioned Motivating Operation (UMO). What are the nine main UMOs for humans? Define a...
Define an Unconditioned Motivating Operation (UMO). What are the nine main UMOs for humans? Define a Conditioned Motivating Operation (CMO). What are the three types of CMOs and how are they applied in Applied Behavioral Science? Your initial post should be 250 words
Describe the typical commercial banks’ balance sheet as well as its main items and describe the...
Describe the typical commercial banks’ balance sheet as well as its main items and describe the structure of a typical investment banks’ balance sheet as well as its main items.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT