When people hear “private equity,” they often picture suits in glass towers doing billion-dollar deals in far-off places. It all sounds a bit Wall Street, a bit overkill for the average Kiwi business owner.

But here’s the thing — that’s not the full story when it comes to private equity in New Zealand.

In reality, there’s a growing wave of private capital investment targeting mid-market businesses right here in New Zealand. We’re talking about privately held companies doing anywhere from $5 million to $50 million in revenue. Not listed, not flashy, just solid, well-run businesses with real potential.

And more often than not, those businesses are still founder-led.

So, What Is Private Equity, Really?

At its core, private equity in New Zealand is just money invested into private companies with the aim of growing their value over time. The investor eventually exits — usually after three to seven years, either by selling the business, listing it, or passing it on to another buyer.

But the money is only part of the picture. Good private equity brings experience, structure, governance, and a fresh perspective. It’s about backing great operators and giving them the tools, capital, and strategic support to go further, faster.

It’s not about taking over or replacing founders. Quite the opposite. Most PE firms want to back the people who built the business in the first place, because they know that’s where the magic is.

Private Equity in New Zealand Isn’t Just for Corporates

Here’s where the misconception kicks in. Private equity in New Zealand isn’t some distant, big-cap game. There’s a whole layer of the market focused on founder-owned businesses in that lower mid-market sweet spot.

We’ve seen this firsthand. Deals where the founder wants to sell part of the business, take some risk off the table, maybe bring in a partner to help scale, or just start planning their succession over a few years, not overnight. These aren’t huge roll-ups or complicated financial plays. They’re often values-driven, relationship-led transactions that respect what the founder has built.

And because PE firms only make money when the business grows, their incentives tend to align closely with the founders. Everyone’s on the same side of the table.

What Do Private Equity Investors Look For?

There’s no perfect formula, but these are the qualities private equity firms typically look for in a mid-market New Zealand business:

  • Strong, recurring revenue
  • Proven cash flow
  • A defensible market position
  • A capable management team (or a founder willing to stay on for a while)
  • Opportunities to grow, new geographies, new products, digital uplift, etc.

You don’t need to have everything polished. But you do need to be open to change and ready for the next stage of the journey.

What Happens After a Private Equity Deal?

This is the part that often gets overlooked.

In most cases, the founder doesn’t walk away the next day. Instead, they stay involved, sometimes in a slightly different role, and help lead the next phase. They might sell a majority or a minority stake, depending on their goals.

What they get in return is a partner. Someone who’s been through dozens of these growth curves before, who can bring structure without bureaucracy, and who can help move the needle in ways that might’ve been out of reach going it alone. A good private equity partner brings more than capital — they offer experience, governance, and access to growth, often working alongside an M&A advisory team to support execution.

Think strategic board input, better reporting, connections to new markets, or access to acquisition funding, all without losing the heart of the business.

Is Private Equity Right for You as a Founder?

Not every founder wants a private equity partner, and that’s fair. But more should at least consider it.

If you’re sitting on a business that’s growing nicely but you’re starting to think about what’s next, whether it’s scaling up, stepping back, or taking some money off the table without selling everything, then it might be worth a chat.

Because this isn’t about billion-dollar buyouts. It’s about smart capital, real partnerships, and building something bigger than what one person can do alone.

Curious what private equity in New Zealand might look like for your business, or how to structure a founder succession plan?

Get in touch, we’re always happy to talk through the options.