Let's have a look at the expected returns in private equity investments, which are typically later stage investments than venture capital funds.

The expected returns will depend on the type of private equity investment being considered.

There are three major types of private equity investments, and we can include venture capital or VC investments here as it is also a private equity or PE investment style.

Although PE funds usually invest at a later stage than pure VC funds, we can see from this chart that venture capital is considered riskier than investing in other asset classes such as leveraged buyouts or growth equity.

It's also expected to offer the highest returns in line with an investor taking on a larger degree of risk growth. Equity is also an equity investment, so they have a higher perceived risk than leveraged buyouts, which are debt financed, leveraged buyouts.

Our control of a public company is acquired with a view to taking the company private and delivering operational improvements.

They will typically have the lowest levels of expected returns in private equity since the company is more mature with well established revenue streams, reducing risk for the investor.

Next on the risk return spectrum is growth equity, which involves the acquisition of established growing companies, where the additional funding provided by the growth investor will stimulate further growth of the company.

Finally, venture capital investing involves early stage startup companies.

These investments have the highest risk since many such companies may not yet be making a profit, but do offer the highest return opportunities if the startup company becomes successful.