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Quarter of entrepreneurs turn to private equity

One in four entrepreneurs will be looking to private equity and venture capitalists to raise capital in 2011, according to research conducted by Investec.

Many entrepreneurs are looking to grow their businesses this year, with 44 per cent expecting to launch new ventures and a further 31 per cent believing that it is “quite likely” that they will do this.

“Their plans could be put on hold because many still fear that access to capital could be difficult. Only six per cent of those we interviewed expect it to be easy to raise funds during 2011,” said James Stirling of Investec Growth & Acquisition Finance.

Recently, Investec announced the formal expansion of its offering with the inclusion of senior debt and preferred equity to its portfolio of core lending capabilities. The new “preferred equity” offering is designed to support private equity deals in situations where a mezzanine debt package may not be appropriate. This includes instances where senior lenders do not want to see cash yield being paid to a mezzanine provider.

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