Contact Us

If you still have questions or prefer to get help directly from an agent, please submit a request.
We’ll get back to you as soon as possible.

Please fill out the contact form below and we will reply as soon as possible.

  • Courses
  • Home
  • Economics, Finance, & Analytics
  • Business Finance, Personal Finance, and Valuation Principles

Private Investment in Public Equity - Explained

What is a PIPE Deal?

Written by Jason Gordon

Updated at April 17th, 2022

Contact Us

If you still have questions or prefer to get help directly from an agent, please submit a request.
We’ll get back to you as soon as possible.

Please fill out the contact form below and we will reply as soon as possible.

  • Marketing, Advertising, Sales & PR
    Principles of Marketing Sales Advertising Public Relations SEO, Social Media, Direct Marketing
  • Accounting, Taxation, and Reporting
    Managerial & Financial Accounting & Reporting Business Taxation
  • Professionalism & Career Development
  • Law, Transactions, & Risk Management
    Government, Legal System, Administrative Law, & Constitutional Law Legal Disputes - Civil & Criminal Law Agency Law HR, Employment, Labor, & Discrimination Business Entities, Corporate Governance & Ownership Business Transactions, Antitrust, & Securities Law Real Estate, Personal, & Intellectual Property Commercial Law: Contract, Payments, Security Interests, & Bankruptcy Consumer Protection Insurance & Risk Management Immigration Law Environmental Protection Law Inheritance, Estates, and Trusts
  • Business Management & Operations
    Operations, Project, & Supply Chain Management Strategy, Entrepreneurship, & Innovation Business Ethics & Social Responsibility Global Business, International Law & Relations Business Communications & Negotiation Management, Leadership, & Organizational Behavior
  • Economics, Finance, & Analytics
    Economic Analysis & Monetary Policy Research, Quantitative Analysis, & Decision Science Investments, Trading, and Financial Markets Banking, Lending, and Credit Industry Business Finance, Personal Finance, and Valuation Principles
  • Courses
+ More

Table of Contents

What is a Private Investment in Public Equity?How Does a PIPE Deal Work?

What is a Private Investment in Public Equity?

A private investment in public equity (PIPE deal) is when a public company sells some of its shares (either common shares or preferred shares) directly to private investors - rather than selling the shares to the general public through a securities exchange.

Back to:BUSINESS & PERSONAL FINANCE

How Does a PIPE Deal Work?

Because a PIPE deal is a direct offering of securities, it must be registered separately with the Securities and exchange commission or quality for a registration exemption as a private placement. A firm that trades publicly is able to use PIPE deals to secure financing for acquisitions, working capital, and expansion. The process generally allows the company to secure capital more rapidly than pursuing sale of shares to the public. 

private investment in public equity pipe

Was this article helpful?

Yes
No

Related Articles

  • Pre-Money Valuation - Explained
  • Capital Formation - Explained
  • Adjusted Present Value - Explained
  • Sum of Parts Valuation - Explained



©2011-2021. The Business Professor, LLC.
  • Privacy

  • Questions

Definition by Author

0
0
Expand