Thursday 21st March 2019,
Centre County Business

Role of Equity Investment Firms in Maximising Profits

Role of Equity Investment Firms in Maximising Profits

All corporates look for new and innovative method to maximise profits. However, increasing productivity and thereby trying to make more profit is a long drawn process. Hence, most corporates look for alternative means to maximise profit. One of the commonest method for maximising the profit margin is by investing the capital gains.

In case of an equity investment firm, the ideal method of earning more profit is by assisting more acquisitions and mergers. According to Rob Joubran a renowned business consultant and presently the Chief Operating Officer (COO) of Platinum Equity, in case of equity investment firms acquire a business, invest in it, consolidate the business process and after that sell the business at a profit.Image result for Role of Equity Investment Firms in Maximising Profits

Although, it sounds simple, acquisitions and mergers are actually a complex business process. Joubran has been working as a business consultant for more than two decades. Moreover, Joubran with his business acumen suggests that even equity investment firms have to look to alternative means to maximise profitability and not just depend on the capital gains from a merger or an acquisition.

Some of the common methods employing which Joubran believes that profitability can be increased are as follows:

  • Separate investments: Instead of investing in a single venture, Joubran believes that investments should be made across a broad spectrum of business projects. This ensures that even if satisfactory dividend is not earned from a particular venture, the company can still earn a profit as it has invested in other undertakings as well.
  • Reinvestment: Instead of withdrawing the dividend earned Joubran believes that it should be reinvested to maximise profit. Reinvestment may include investing in the share market or in a venture that has quick returns.
  • Selling of mergers: Sometimes equity investment firms carry out mergers to provide structure to a highly fragmented industry. Say for instance the healthcare industry. This is a highly fragmented part of the economy. Platinum Equity has been involved in merging two or more companies of the healthcare industry. After merging Platinum Equity often sells this merger at a profit. This profit is then distributed as a dividend amongst stake holders.  

Thus, all equity investment firms have to come up with new and innovative methods that will help them maximise their profit margin.

According to Rob Joubran, new means earning more profit is essential to ensure faith amongst stakeholders. Being highly innovative, Joubran tries to reinvest company capitals in markets that provide swift returns. However, he does so only after safeguarding the investment and being assured of almost certain returns.

Joubran a pass out of the University of Michigan is well aware of the importance of a good investment. However, as a venture capitalist Joubran is prepared to take measured risk. As the COO of an equity investment firm, Joubran is uniquely position to provide business advice. Thus, if one is looking for advice regarding an investment, acquisition or merger consider consulting the Platinum Equity, investment firm and be assured of good profits.

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