| Private equity investors can make use of six top | | | | on strong management. This signals a strong |
| secrets that can assist in finding the most | | | | business opportunity, or else competent individuals |
| successful and profitable private equity deals. | | | | would be focusing their talents somewhere else. |
| Secret 1. Be in the right place. Become privy to | | | | Look for a team that is backed up by |
| special investment opportunities by being in places | | | | considerable experience and a track record of |
| where established entrepreneurs congregate. This | | | | delivering high rates of return on investment. |
| could be at business events, conventions or online | | | | Secret 4. Scrutinize the exit strategy. When |
| meets. Situate yourself in places where you hear | | | | projects are either sold or refinanced, an "exit |
| of big deals the general public only finds out about | | | | strategy" or "liquidity event" still offers rewards to |
| later. | | | | investors. Make sure that you understand the exit |
| Secret 2. Research on the firm's background. No | | | | strategy of a project before you pursue it. |
| matter how much positive feedback you get | | | | Secret 5. Exert due diligence. The smart investor |
| about a company, or how airtight the projections | | | | seeks out funds that are attuned to his own |
| seem to be, the smart investor always conducts | | | | investment goals. To be able to do this, you need |
| diligent research on where a company stands. The | | | | to make a thorough review of the company's |
| shrewdest investors ensure that the following | | | | business plan before deciding to invest. |
| criteria are met in a potential firm: there is a large | | | | Secret 6. Diversify. Diversification never fails to |
| and sustainable market for the project; the | | | | secure your money, especially in private equity |
| project offers a practical exit strategy; and the | | | | investing. This reduces the risk of a single, bad |
| project is based on realistic financial assumptions. | | | | performing investment hurting your entire |
| Secret 3. Evaluate management's capacity to | | | | portfolio. |
| deliver. The smart investor looks for a firm built | | | | |