Private equity Vs Buyout funds

Hi, 1. I am confused between these two categories of alternative investments. I feel that Private Investment in Public Entities (PIPE), a subgroup of Private Equity, is the same as buyout fund. 2. Also Schweser notes say : indirect investment is usually done through private equity funds, which include venture capital and buyout funds. (?) Can you please shed some light? Thanks, MG.

buyout funds is one type of private equity like chesty brunettes is one type of female there are many types, and you should dabble a little in each to become properly diversified

these types…they must have long long term horizons not too many unique circumstances plenty of liquidity (oh no he di-int?)…yes I did

Buyout = “Look at Larger co. that’s public… let’s take it private and make a killing doing it” Venture = “These guys have a good idea with these widgets, let’s invest with them and exit when they go public in about 7 years” PIPE = “Are you kidding? THe gov’t is running this toll road like garbage, we’re going to buy them out and run it better than they ever did before and make a killing doing it”. Direct in venture = “Hey new tech, here’s a commitment for a couple million and a few hundred thousand up front… good luck?!” Indirect = “Ok let me get this straight Mr. Venture Capitalist, your going to pool your money with our’s and invest in a bunch of start ups and make us a killing doing so. I’m so in”.

the last two I don’t recall seeing those in stalla or CFA book. can you refer the page number. thanks.

thanks guys.

is indirect preferred stock?

no, direct is preferred stock. inderect you become a partner in LLC IMHO

Direct can be preferred or any other direct ownership in teh company. Indirect is when you invest in a PE fund or similar structure so you are investing through the PE fund. Think of it as Direct Real Estate is to buying a House as Direct PE is to buying a majority stake in a company and Indirect Real Estate is to buying a REIT as Indirect PE is to investing in a PE fund.

angel investors would be the typical direct venture capital investors. a PIPE is a private placement by a publicly listed company (not an infrastructure investment).

i hate all this SH!T the most…