Evan Vitale – What is Private Capital?

December 1, 2015 by Evan Vitale

By Evan Vitale

(This is Part III in our series on different types of capital, including debt capital, equity capital, private equity, venture capital, angel investors and investors).

Private capital is similar to a bank loan as it is indeed money that is provided to a business. However, the capital “loan” doesn’t come from a bank; government entity or from the public by selling stocks.

Instead, private capital comes from private individuals – or a group of individuals – who make investments (or loans) that are not regulated by the government or by the rules of a public exchange.

A private capital investment typically happens as a one-on-one transaction between the business and the investor. Therefore, the business can seek private capital anytime it needs it: startup, growth, etc.

Evan Vitale – What is Equity Capital?

November 26, 2015 by Evan Vitale

By Evan Vitale

(This is Part II in our series on different types of capital; including debt capital, equity capital, private equity, venture capital, angel investors and investors.)

Equity Capital, when compared to debt capital, is different in that you do not need to pay anything back to the investor.

No, it’s not a free loan.

Instead, you are selling complete or part ownership interest in your business in exchange for capital. Typically, an equity capital situation may arise with large-scale businesses who are running short of funds.

A common source for equity capital is from family members and relatives. In fact, in a recent survey, 30% of entrepreneurs said they raised all or part of the capital they needed through family members.

Be sure to talk to your business attorney before seeking equity capital. Know the risks before your seek this type of financing.

Also see: What is Debt Capital?

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Check out another blog by Evan Vitale here: http://evanvitale.com

Evan Vitale – What Is Debt Capital?

November 24, 2015 by Evan Vitale

By Evan Vitale

In our next few blog posts, we’ll discuss different types of capital, including equity capital, private equity, venture capital, angel investors and investors.

But first, let’s talk about debt capital, which is the most common type of capital.

Debt capital is the capital that a business raises by taking out a loan. The loan is normally repaid at a future date, usually with interest.

Typically, debt capital is obtained from your regular bank or, if the loan is large, then it may come from an investment bank. Consider a debt capital loan just like taking out a loan for a home mortgage or for an automobile.

The big difference between debt capital and other types of capital is that the lender doesn’t become part owners of your business. However, some debt capital lenders expect to earn up to 10% interest (or more) off the loan.

Debt capital is very common among entrepreneurs, who the investor believes most likely will pay off the debt by an agreed-upon deadline.

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View presentations by Evan Vitale at http://www.slideshare.net/evanvitale.

Evan Vitale – Allowing Your Team To Enjoy The Holidays

November 18, 2015 by Evan Vitale

By Evan Vitale

Now that we’re closer to Thanksgiving, Hanukkah, Christmas, New Year’s Eve and many parties, gatherings and events, it might be hard to keep your team focused and productive.

Unfortunately, work productivity does tend to slack off and suffer during the holidays. It’s nearly impossible to avoid it, but you still need to keep everyone focused in order to meet deadlines and continue work production.

Here are some tips to help keep everyone on track while, at the same time, allowing everyone to enjoy the holiday spirit:

* Plan vacation days and work days well in advance. This lets everyone know what days your office will be closed (or closing early) and prevent everyone from taking the same week off for holiday vacations and leaving you with an empty office.

* Consider allowing some employees the option of working from home. While this might be difficult with all the holiday distractions, employees can check e-mail regularly and produce reports and statements between the feasts and eggnog toasts.

* Allow and plan for a holiday office party. It’s almost expected in every office. Your team has worked very hard over the past year, so let them celebrate the season together. It can be as simple as a pot luck lunch or, perhaps have food catered in. Some small offices take their staff to lunch at a nice restaurant and, yes, allow employees to have a small gift exchange, too!

* Continue to take care of your customers and clients, but do be careful in launching any new programs, services or products during the holiday season. Remember, your customers and clients are also celebrating the season as well and probably won’t have much brain space for any new initiatives.

* Be reasonable. Hey, it’s the holidays! Don’t be Mr. Scrooge and have your employees working late on Christmas Eve – or any other evening for that matter. This is the time of the year that families matter the most, so allow them to be with their families and friends. They’ll appreciate it.

Finally, make sure that you are giving yourself a break too to enjoy the holiday season.

Evan Vitale – Private Equity Billionaire Sponsors 300+ Kids

November 12, 2015 by Evan Vitale

By Evan Vitale

Business Insider published an interesting article recently in which a private equity billionaire sponsored 350 New York City school children AND then sent them all a personal note about their report cards.

Steve Schwarzman, also known as “King of Capital” says he got involved with the Inner-City Scholarship Fund knowing that nearly 70% of the kids are either at or below the poverty line and 90% are minorities. Schwarzman reviews each child’s report card, absent reports, etc., and then hand-writes them a personal note on his stationery.

Schwarzman and his wife, Christine, have donated over $48 million to the Inner-City Scholarship Fund since 2001.

You can read the full story here:

http://www.businessinsider.com/steve-schwarzman-comments-on-report-cards-2015-11

Evan Vitale – 5 Distracting Habits Eating Your Productivity

October 30, 2015 by Evan Vitale

By Evan Vitale

Productivity is the name of the game and in today’s ultra competitive market, understanding the pitfalls of distracting, time-wasting behavior can help rearrange your day in a more efficient manner. If “you are what you eat,” you are also what you dedicate your time to. Bad habits like checking your email every 15 minutes, aimlessly roaming the office, or perfectionism may become your downfall as important projects slip through the cracks and your focus and attention lay elsewhere. Here are 5 bad habits you should break in order to make the most of your work day.

1. Stop checking your email every 15 minutes.

If you are one of the 32% of Americans who respond to an email within 15 minutes of receiving it, or the 23% who respond within 30 minutes, you are checking your email way too often. Most of the mail you receive is classified as non-urgent with a typical 24-48 hour response window. In high pressure situations when you know someone may be expecting an immediate response, it may make sense to check your email frequently; however, in the future, take some time to focus on one project at a time, devoting a solid 60 – 90 minutes on the task before disrupting your flow and checking in external situations.

2. Along the same lines, stop multi-tasking!

We all believe we’re the best multi-tasker we know, and many companies welcome employees to feel said way. However, in truth, your brain primarily focuses on one task at a time. Constantly switching between browser tabs, readings, emails, write-ups, and the likes will make you less productive. If the tasks relate, gently intertwine them. Otherwise, schedule your time appropriately, scheduling one task after the other.

3. Perfectionism is getting in the way of your best work.

You should always double check your presentations, re-read emails, and generally treat your work with caution. Yet constantly micro-analyzing your own work will create a productivity deficit that may be hard to recover from. Perhaps try a school work approach by composing a rough draft, walking away from the project, and then returning at a later time when you’re less critical, less fatigued, and have a better perspective. Efficiency is key in a fast paced environment and in order for you to yield high quality results, you have to let go of perfectionism – no matter how much of an oxymoron is may seem to be.

4. Disorganization will be the bane of your productivity only if you let it.

Disorganization is killer. Whether it’s your planner, iCal, Google Drive, or work station, staying organized will help keep you on task and focused. Many fail to recognized how a messy desk can in fact cause subconscious stress and undo anxiety. Disorganization may even tempt you to procrastinate actual work, wasting copious amounts of time working through the chaos instead of producing results.

5. Answering every distracting invitation aimed your way in the affirmative will stifle you.

On average, employees are distracted every 11 minutes. Because of this, your momentum is never quite revved up to full capacity. After you’ve been interrupted from your work, you’re more likely to participate in bad habits like checking your email as mentioned above. Additionally, if you have an issue saying “no,” yes-man behavior could land you in a predicament where you now have way more tasks than you can effectively complete, leading to excessive multi-tasking and disorganization.

Evan Vitale – Top Two Private Equity Firms That Create Billionaires

October 6, 2015 by Evan Vitale

By Evan Vitale

Private equity has created many billionaires over the years, but it seems there are a few firms that do it better than others. Forbes creates its Richest Americans list each year and their latest one features many private equity executives who have made their money with leveraged buyouts. It seems last year was a really good year for private equity, which is stated by Business Insider as “the strongest since the financial crisis.” According to research firm Prequin, private equity and venture capital assets reached a new high of $3.8 trillion under management. Here are a few of the top private equity firms that have the most billionaires associated with the firm:

Apollo Global Management

This private equity firm has a few billionaires on the Forbes list, including co-founder Leon Black. He came in at #94 on the list and is worth about $5 billion. As a Wall Street legend, he’s also a well-known figure in the art market, with his most notable purchase Edvard Munch’s “The Scream.”

Another Apollo Group billionaire is co-found Joshua Harris, who owns two professional sports franchises – owning the Philadelphia 76ers and the New Jersey Devils. He came out at #268 on the Forbes list. The firm’s Marc Rowan comes in at #279 and has about $2.4 billion behind him. He put his money in his own family office thanks to his stock in the equity firm.

Carlyle Group

The other major company that churns out billionaires is the Carlyle Group and their co-founder David Rubenstein is ranked #256 on Forbes’ list. The company went public back in 2012 and started out big taking on investments out of the public eye, unlike other companies like the Apollo Group.

Another Carlyle Group billionaire is Dan D’Aniello, who is one of the three billionaires it’s created since it was first founded in 1987. He’s also at #256, along with the third co-founder of the company William “Bill” Conway.

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Evan Vitale writes and publishes another business blog at http://evanvitale.com.

Evan Vitale – Networking: A Two-Way Street

September 29, 2015 by Evan Vitale

Whether a friendship, romantic partner, or family member, maintaining a relationship requires mutual effort. People resent being taken advantage of or used solely for what they have to offer with little to no reciprocity. The same sentiment can be found in the realm of networking. If you approach networking with a selfish mindset, only considering what you can get for free, then you are networking incorrectly. While it may be difficult to know when it’s appropriate to ask for advice or favors, especially when you’re just starting out in your career field, here are 5 warning signs to show if you are neglecting your end of the bargain.

Are you criticizing free advice?
Criticizing free advice is similar to a starving man throwing a perfectly good meal back in the giver’s face. If the advice you receive is nonapplicable to your situation, instead of criticizing, ask followup questions. Being argumentative makes you seem unappreciative and crass. Remember, there’s no faster way to burn bridges than poor manners and inappropriate behavior.
Are you unprepared to make the most of a network connection’s time?
Be sure to prepare specific questions or scenarios when utilizing a network connection for advice. This is one way to prevent misdirected conversation. Similarly, when attending a networking event, take some time to think about why you are attending. Is it simply because you want to be in the presence of industry professionals, or would you like to build lasting relationship with people you can truly learn from, grow with, and form an alliance.
Are you “pimping” out your network connection?
One of the most unprofessional things you can do is pass around your network connection’s information without their permission. Just as you wouldn’t use a reference who hasn’t consented for a job interview, don’t haphazardly hand out a connection’s contact. No one wants to receive unsolicited requests from individuals they do not know.
Are you name dropping?
Similar to point number three, you can easily seem like a networking leech if you name drop who you know in casual conversation. While it may be nice, or even impressive at times, to have a working relationship with an industry leader, name dropping is superficial and provides very little depth.
Are you “too busy” to help others?
Be sure to make time to help others. Only receiving when the moment is convenient for you not only stunts your personal growth and development as a mentor and leader, but also disengages you with the industry community at large. People should recognize you as an individual who has taken advice, grown from it, and demonstrated to others that they are now in the position to help. Pay it forward.

Keeping these 5 things in mind will help you form meaningful and lasting network connections.

Evan Vitale – 2015 Venture Capital & Private Equity Country Attractiveness Index

July 15, 2015 by Evan Vitale

Knowing when to invest and where are sometimes difficult. You have to assess which countries offer the most promising markets and which ones have the biggest entrepreneurial support. The place where you choose to invest your money has to have a strong incentive or reason to invest with protection and venture support.

The 2015 Venture Capital and Private Equity (VC/PE) Country Attractiveness Index recently released a running list from best to unfavorable countries to place investments. Of the 120 countries analyzed, the United States, the United Kingdom, Canada, Singapore, and Japan ranked at the very top. Conclusions were made based on thousands of data points and each country’s overall attractiveness to VC/PE investors. This index is not only important to investors, but regulators who can use the information provided to set new policies or revise old ones to help create a more desirable package for investors.

In addition to well established “green light” markets, private equity investors have the ability to keep an eye on emerging markets with acceptable risk to reward ratios. Current emerging markets are Mexico, Indonesia, the Philippines, Nigeria, Turkey, and South Africa. Countries like China, Russia, India, and Brazil have been in the ranks for a while now, with China leading the way as most attractive. Although investors can sometimes jump the gun, or present themselves as overly enthusiastic for emerging markets, investing in them is the only way to jump start the process and potentially reap the extraordinary reward of being an early adapter.

As for the 2015 ranking, here are the top 10 attractive investment locations:

United States
United Kingdom
Canada
Singapore
Japan
Hong Kong
Germany
Australia
New Zealand
Switzerland

And here are the 10 lowest ranking locations:

Burkina Faso
Mali
Venezuela
Benin
Lesotho
Syria
Mauritania
Chad
Angola
Burundi

For more information, be sure to check out the 2015 index here: The Venture Capital & Private Equity Country Attractiveness Index

Evan Vitale – Private Equity on the Rise

May 6, 2015 by Evan Vitale

After the global financial crisis the most important lesson learnt by the business world was – Expect the Unexpected. In a post global financial meltdown environment many private equity firms today are operating within limits and under ever increasing uncertainty.

Keeping in view this scenario how do businesses balance buy and sell side opportunities and more importantly how do they expand into new markets and diversify into new revenue channels when now more than ever the focal point of all business is keeping a check on their existing portfolio’s while at the same time meeting up the to the challenge of new regulatory frameworks and risk management techniques.

It is important for businesses to gain a perspective, even though after the market turmoil faced and the industry left reeling, many groups are now coming forward and looking into deals and opportunities.

In the light of macro-economic uncertainties it is important to point out that private equity companies similar to that of other industrial giants are just as much exposed. Within this frame it is also important to consider the issue and impacts of sovereign debt within the US and European Union which is just coming up to the horizon.

However in the light of the above issues it is still seen that private equity is able to demonstrate a certain level of resilience and nimbleness with an ability to withstand shocks. Keeping this in mind, it is no surprise that most private equity investors have been able to come out of the recession with a renewed sense of aggression and focus on organic revenue growth. The key however to this is applying and taking up more entrepreneurial experts and mindsets from the market and adding them onto your portfolio.

We will for sure see private equity on the rise again as they take the helm as companies who are able to demonstrate an active ownership skill, this is evident from examples which can be taken from North America and Europe on how private equity creates value. This inevitably has an effect and enables them to create more stronger and profitable businesses.

Coming back to point of expanding, it is seen that institutional investors are now taking an active part in Latin America’s growth and that of Brazil in particular. As a result a surge has been noted in their keenness on expanding private equity programs in this region.

On the other hand Risk, Regulation and Compliance also play an important role. This is especially when considering market volatility and pricing pressures – these are tools which are usually in play to create competition and opportunities. Businesses on the whole need to develop strategies in order to provide a balance between risk and opportunity.

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