Independent thesis Advanced level (degree of Master (Two Years)), 20 credits / 30 HE credits
The private equity industry has had a fluctuating history. In the years between 2003 and
2007 the private equity industry expanded tremendously, yet in 2008 a financial turmoil
caused significant deviation in the activity of the industry. During the credit crunch the
liquidity in the market decreased affecting the sources of capital available. When several
firms compete about the capital available, fundraising becomes increasingly difficult and
competition intensifies. Sweden is one of the largest private equity markets in Europe and
has among the Nordic countries been able to raise the largest amount of funds. The
purpose of this study is to examine the fundraising process implemented by private equity
firms, nevertheless the relationship that emerges between the fund manager and the
investor. The authors’ objective is to provide an adequate interpretation of the private
equity industry in Sweden.
The authors have implemented a qualitative method, as the objective has been to obtain a
profound picture of how private equity firms manage their fundraising. The abductive
approach has been used in order to collect empirical data and semi-structured interviews
have been carried out with representatives from four private equity firms. In addition, a
smaller survey has been performed with two institutional investors to add to the objectivity.
Subsequently, the empirical data has been analysed in regards to theory and compared in
relation to the sources to end up in a conclusion.
The authors have through the study concluded that private equity firms in Sweden with a
focus in buyouts not have a common fundraising model. Private equity funds are selective
in their choice of investors and prefer professional, loyal investors with a long-term
perspective and strong capital base. It has from the analysis emerged that good reputation,
history, team and experience is valuable in fundraising. Firms that are successful in their
operations and management appeal to investors. The investors are typically institutionalised
and invest in different asset classes, hence the diversification is mainly in the hands of the
2011. , 73 p.
Eklund, Johan, Assistant Professor in Finance, Associate Dean for EducationHögberg, Andreas, Ph.D. Candidate in Economics