Private equity started in the early 20th century as a way for wealthy individuals to invest directly in private companies, away from the noisy, volatile stock markets.

The real breakthrough came in the 1950s and 1960s when investors realized they could pool their money together into private equity funds 🤝

These funds began buying struggling companies, giving them a makeover, and selling them for a profit.

After realizing how much money they could make, the deals got larger and larger 🔄💰

The 1980s and 1990s were the golden years, with iconic deals such as KKR $25B acquisition of RJR Nabisco that shook up industries and made headlines 📈

Today, the $4.7 trillion private equity industry is a juggernaut in the financial world, with firms using their expertise and cash to help businesses grow and thrive 💪

The outlook for private equity in the coming years is positive. Many firms have a lot of unused cash that they pooled from investors and are looking to invest it 🔮

Some recent PE deals that you might have heard of include Japan Industrial Partners’ acquisition of Toshiba for $15.2B or Elon Musk’s acquisition of Twitter for $44B 📰

In the next lesson, we’ll talk about the secret weapon that PE firms use to achieve high returns! 👀