A private placement agent or placement agent, in finance, is an individual, or, more frequently, a firm that assists entrepreneurs or private companies looking to raise private equity or other capital through a so called private placement. Within the context of private equity, placement agents can serve several functions:
- Raise growth capital, mezzanine capital or venture capital for a company
- Raise investor commitments to new private equity funds
- Advise existing owners of private equity assets on secondary market sales of their interests
The placement agent acts as a intermediary between those seeking to raise money and various investors who may be interested in investing in the company looking to raise funds. Many placement agents are structured as groups within large investment banking firms (e.g., Credit Suisse, Lazard, UBS Investment Bank, Citigroup) or as separate boutique investment banks (e.g., Atlantic-Pacific Capital, Campbell Lutyens, Probitas Partners, Park Hill Group, Venturi Capital Advisors).
Placement agents will regularly seek to raise capital from a variety of institutional investors (e.g., pension funds, insurance companies, endowments, fund of funds, Sovereign wealth funds) as well as high net worth individuals.
Placement agents are most often compensated through fees, paid by the the company or individuals raising capital, based on on the amount of money raised.
Bibliography
- Wilmerding, Alex. Deal Terms ISBN 1-58762-208-4
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