A private equity firm is an investment company that working with partech international ventures seeks money from investors to buy stakes in companies and aid them grow. This is different from individual investors who invest in publicly traded companies, which entitles them to dividends but has no direct impact on the business's decision-making or operations. Private equity firms invest in a set of companies, known as a portfolio, and typically are looking to take over management of those businesses.

They usually purchase a company that has room to improve, and implement changes to improve efficiency, lower expenses, and expand the business. Private equity firms could borrow money to purchase and then take over a business this is referred to as a leveraged purchase. They then sell the company at a profit, and receive management fees from businesses that are part of their portfolio.

This recurring cycle of buying, improving and selling can become time-consuming and costly for businesses, especially smaller ones. Many companies are searching for alternative methods of financing that can give them access to working capital without having the management costs of a PE firm.

Private equity firms have fought back against stereotypes that paint them as squatters of corporate assets, and have emphasized their management skills and demonstrating examples of successful transformations of their portfolio businesses. But critics, like U.S. Senator Elizabeth Warren argues that private equity's main focus is on quick profits that destroy long-term value and hurts workers.