1. Exits are ultimately how private equity firms realize returns on their investments. Describe the various ways for a private equity firm to exit an investment. 

2. What are some of the key considerations in determining whether to take a company public?

 

3. What are some of the possible explanations for why acquisitions account for a greater percentage of exits than IPOs?

 

4. What are some of the characteristics of a private company that may increase the likelihood of an IPO?

 

5. What are some of the characteristics of a private company that may prevent it from going public?

 

6. Why might the pursuit of an IPO elicit higher interest and/or offers from strategic acquirers?

 

7. What are some of the key advantages of being a public company? What are the disadvantages?

 

8. Why would a public company prefer institutional holders to comprise a large portion of their investor base? Who is responsible for attracting these investors? 9. Explain the phenomenon of underpricing as it relates to IPOs.

 

10. What is a “Green Shoe” and why does it exist?

 

11. What is a possible explanation for why a VC-backed company outperforms the market for several years after its IPO?

 

12. What purpose does corporate VC serve? What are the potential advantages?

Answer rating: 100% (QA)

1 Various Ways for Private Equity Firms to Exit an Investment Initial Public Offering IPO Selling shares of the portfolio company to the public through a stock exchange Trade SaleAcquisition Selling t... View the full answer