Once a company goes public and the price of its shares go up I guess some investment firms can make money that way. But how do investment firms that invest in non-public companies (e.g. small startups) make money? Do they just keep on investing until the company goes public and they can reap profits (through stock prices etc.)?
In: Economics
Venture Capital and Private Equity firms hold shares or percentage of ownership in companies. They hope to help the business grow so that it can either go public, in which case their private shares become public shares they can sell for profit. Or the business gets acquired, resulting in them getting paid out in cash and/or stock of the acquiring company.
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