What is Growth Equity?

Growth equity is a segment of the private equity industry. Growth equity investment focuses on creating value through profitable revenue growth. Research performed by Cambridge Associates shows that growth equity is outperforming venture capital over three (3), five (5) and ten-year investment periods. Cambridge and other large institutional investors increasingly recognize growth equity as a private equity asset class that is separate and distinct from venture capital and leveraged buyouts. Growth equity can be better understood by evaluating its return profile, risk characteristics, and the profile of target growth equity recipients relative to the venture capital and leveraged buyout segments.