In Law360, Carl Marcellino Discusses the Perfect Recipe for Growth Equity Investing

The slowdown in deal activity over the past several quarters can be attributed to high interest rates, inflation, and uncertainty among other variables in the current macroeconomic environment. But recently there has been an uptick in growth equity deals in a variety of sectors, including tech, food and beverage, financial services, infrastructure, and healthcare. In a Law360 piece, private equity partner Carl Marcellino shares insight into why current circumstances are creating an appetite among investors for growth equity investing.

“The theory is that by taking a minority position with some structured downside protection, growth equity investors can put money to work at higher valuations than they otherwise might be comfortable taking a control position in,” Carl wrote.

“And founders and owners can raise funds at valuations that are acceptable without giving up too much of their companies, all while still providing needed sources of secondary capital for existing legacy investors that are otherwise interested in monetizing their positions.”