There is typically a hurdle rate (a yearly needed return of 7-10%) that basic partners need to achieve before performance costs are allowed to be taken. The structure of these efficiency charges encourages the partners of private equity companies to generate large returns; they are meant to align the interests of the basic partner with the limited partners - Ty Tysdal.

PE Company Focus There are many various types and sizes of private equity firms and funds. businessden. A private equity company could have multiple funds that can specialize in either a specific market or a particular geography. Private equity companies develop funds to focus on locations where they think that can produce value for business. .