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How to Start a Private Equity Firm – and Why You Probably Shouldn’t

Brian DeChesare

Starting a private equity firm is a bad decision for ~95% of people who work in the finance industry. EXAMPLE: Let’s say you’re planning to have 10 portfolio companies in your first fund, and the average Purchase Enterprise Value will be $50 million. In this example, if you charge a 2% management fee, that’s $5 million per year.