Raffles Global

In the world of finance, there are two primary sources for businesses seeking to raise funds: private and public markets. The private capital market is comprised of individual investors, family offices, and private equity firms, while the public capital market is comprised of stocks and bonds traded on public exchanges.

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Private capital market refers to investment opportunities that are only available to a select group of investors, typically those who are accredited or have a high net worth. These investments can include private equity, venture capital, and real estate.

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Private capital market offers several advantages over public market, including retention of corporate control, investor selection, flexible terms and shorter fundraising periods. In contrast, the public market is often associated with the cost of audit review for listing and diminished corporate control.

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Fundraising Advantages of Private Equity: When it comes to fundraising, there are a number of advantages that private capital market offers over public market. Let's examine why private capital markets may be the better choice for some businesses.

Fundraising simplified and accelerated: IPO is a complex and time-consuming process with overwhelming legal and regulatory requirements. Companies are subject to greater scrutiny from regulators and the public, which can limit its ability to make strategic decisions and protect its interests.

Choice of investors: Select and filter investors who are aligned to your business goals, they may be able to provide advice, assistance as well as funding.

Retain control: Companies choose to remain privatized to retain control of operations and not affected by stock price fluctuation in the public market. Private companies shareholding can be retained by selected individuals or families.

Greater flexibility: VCC can operate both open-ended and closed-end funds, to adopt either traditional or alternative strategies. It can pay dividend out of its capital.

Favorable terms: Private equity can provide favorable terms such as retaining control of operations and protecting interests. Companies raising capital through private equity can negotiate more favorable terms and avoid high costs of going public.

Investors' privacy: Investors of VCC private equity funds are protected by the VCC Act. Investor information will not be made public, it will only be provided to the Monetary Authority of Singapore (MAS).