Private Equity Finance Reporting: The Investment Thesis

An investment thesis can be used for all investment(s) including public equity, debt, private equity, currency, real estate and anything else in which one entity (or person) invests money in another entity or vehicle.

There are typically at least two filtering layers that a Private Equity (“PE”) PE Fund applies to each investment. To understand the investment thesis, you need to understand the PE Fund’s investment strategy. The PE Fund’s investment strategy acts as an initial filmust is used to pitch investors and other external parties and defines how the PE Fund intends to generate returns. An investment thesis considers the PE Fund’s investment strategy and layers in investment-specific characteristics, potential actions, and the reason why it believes that this specific investment will provide an attractive return within its broader investment strategy.

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