Private equity (PE) is a category of financial buyer that raises pooled capital from institutional and individual investors and deploys it into acquisitions of operating businesses, typically with the intent of exiting through sale, IPO, or recapitalisation within three to seven years. In the Australian sub-$20M bracket, PE buyers are most active in roll-up and platform strategies (allied health, vet, professional services, MSPs).
PE buyers typically expect rollover equity from the founder, defined operational improvement plans, and aggressive exit timelines. Negotiations with PE buyers are characterised by sophisticated diligence, structured deal terms, and disciplined price negotiation.