A

1. Accredited Investor
An investor who meets SEC income or net worth thresholds.
💡 Think of it like having the right medical license — it qualifies you to access more advanced “procedures” (investments) that others can’t.

2. Active Management
When professionals make ongoing decisions to improve investment performance.
💡 Like a surgeon constantly adjusting during an operation to get the best outcome.

3. Alternative Investments
Anything outside traditional stocks and bonds — includes private equity, credit, real estate, etc.
💡 The “specialty care” of investing — not routine, but often where innovation happens.

4. Angel Investor
Someone who funds very early-stage startups, often mentoring founders.
💡 Like backing a promising medical resident before they become an attending physician.

B

5. Buyout
A private equity firm buys control of a company to improve and later sell it.
💡 Similar to buying an underperforming clinic, modernizing it, and selling it at a higher value.

6. Bridge Loan
Short-term financing until permanent funding arrives.
💡 Like a temporary line of credit to cover payroll until insurance reimbursements arrive.

C

7. Capital Call
When a fund asks investors to send in committed funds for a new deal.
💡 Like a hospital calling in pledged donations when it’s time to build a new wing.

8. Capital Commitment
The total amount you’ve promised to invest over time.
💡 A long-term pledge, not an upfront payment.

9. Carried Interest (“Carry”)
The profit share fund managers earn if investments perform well.
💡 Like a performance bonus for hitting quality or revenue targets.

10. Co-Investment
Investing directly in a specific deal alongside a fund.
💡 Joining a trusted colleague on a single high-potential case rather than the whole practice.

11. Collateral
Assets pledged as security for a loan.
💡 Like using medical equipment as backup for a business loan.

12. Covenant
Rules borrowers must follow in a loan agreement.
💡 Think of it as “treatment plan compliance” for borrowers.

D

13. Deal Flow
The number and quality of investment opportunities a fund sees.
💡 Like the patient referral pipeline in a busy specialty practice.

14. Due Diligence
Thorough research before investing.
💡 The financial equivalent of reviewing a patient’s full chart before surgery.

15. Diversification
Spreading investments to reduce risk.
💡 Like not relying on one payer or one procedure for your entire revenue stream.

E

16. EBITDA
A measure of a company’s profit before certain expenses.
💡 Think of it as “operating income” before taxes and depreciation — a quick health check for a business.

17. Exit Strategy
The plan for how to sell or realize value from an investment.
💡 Like planning how you’ll eventually transition out of your practice.

F

18. Feeder Fund
A structure that pools smaller investors into a larger institutional fund.
💡 Like joining a medical group to access better resources.

19. Fund of Funds
A fund that invests in multiple other funds for diversification.
💡 Like a hospital system owning several specialty clinics.

20. Fund Manager (General Partner)
The professionals who run the fund and make investment decisions.
💡 The “chief medical officer” of your investment portfolio.

G

21. General Partner (GP)
The entity managing the fund, responsible for decisions and operations.
💡 The attending physician leading the case.

22. Gross vs. Net Returns
Gross = before fees; Net = what you actually receive.
💡 Like gross charges vs. net collections after insurance adjustments.

H

23. Hurdle Rate
The minimum return a fund must hit before the manager earns bonuses.
💡 Like a quality metric threshold before incentive pay kicks in.

I

24. Illiquidity
When you can’t easily sell or cash out your investment.
💡 Similar to owning a building — valuable, but not easily sold overnight.

25. Infrastructure Investment
Investing in essential systems like roads, data centers, or renewable energy.
💡 The “public health” of investing — foundational but long-term.

26. Internal Rate of Return (IRR)
A measure of how quickly investments grow over time.
💡 Like tracking a patient’s recovery rate — speed matters, not just outcome.

27. Investment Period
The years when a fund is actively making investments.
💡 Like the active treatment phase before moving into maintenance.

J

28. J-Curve
Private fund returns often dip early (due to fees) before rising later.
💡 Like the early costs of opening a new clinic before it becomes profitable.

L

29. Leverage
Using borrowed money to amplify returns (and risk).
💡 Like using advanced equipment — boosts productivity but adds cost and complexity.

30. Limited Partner (LP)
The investor who provides capital but doesn’t manage the fund.
💡 You’re the “silent partner” in the operating room.

31. Lock-Up Period
The time you must stay invested before you can withdraw.
💡 Like committing to a multi-year contract before you can change employers.

M

32. Management Fee
The annual fee paid to fund managers for running the fund.
💡 Like an administrative or management overhead charge.

33. Mezzanine Financing
A mix of debt and equity — higher risk, higher potential return.
💡 Like a high-yield procedure — more complex, but potentially more rewarding.

34. Multiple on Invested Capital (MOIC)
How much your money has multiplied (e.g., 2.0x = doubled).
💡 Like measuring ROI on a new imaging machine purchase.

N

35. NAV (Net Asset Value)
The total value of a fund’s assets minus its debts.
💡 The “balance sheet snapshot” of your investment’s health.

O

36. Operating Partner
An expert who helps portfolio companies improve performance.
💡 The practice consultant who boosts efficiency and profitability.

P

37. Portfolio Company
A business that a private equity or venture fund owns.
💡 Like a clinic or practice under a hospital system’s umbrella.

38. Preferred Return
The minimum return investors get before managers earn bonuses.
💡 Like ensuring base compensation before incentive pay.

39. Private Credit
Loans made directly to companies outside traditional banks.
💡 Like providing financing to a medical device startup instead of buying its stock.

40. Private Equity (PE)
Investing in established private companies to improve and sell later.
💡 Like acquiring a struggling practice, optimizing operations, and selling it profitably.

41. Private Placement
Selling investments directly to a few qualified investors.
💡 Like an exclusive partnership opportunity, not a public offering.

Q

42. Qualified Purchaser
An investor with $5M+ in investments, eligible for exclusive funds.
💡 The “board-certified” level of investor qualification.

R

43. Real Assets
Physical assets like real estate or infrastructure.
💡 Tangible investments you can see and touch — like hospital property or solar farms.

44. Real Estate Private Equity
Funds that buy, improve, and sell properties for profit.
💡 Like renovating medical office buildings to increase value.

45. Recapitalization
Changing a company’s debt/equity mix to free up cash or restructure.
💡 Like refinancing your practice loan to fund new equipment.

46. Redemption
Selling or withdrawing from a fund (if allowed).
💡 Like cashing out of a retirement plan early — possible, but with restrictions.

S

47. Secondary Market
Where investors can buy or sell existing private fund interests.
💡 Like transferring ownership in a medical partnership.

48. Syndication-
Multiple investors pooling money for one deal.
💡 Like a group of physicians co-owning a surgery center.

T

49. Term Sheet
A summary of key deal terms before final contracts.
💡 Like a treatment plan before surgery — outlines what’s expected.

50. Tender Offer Fund
A private fund offering limited quarterly liquidity.
💡 Like being able to withdraw part of your investment every few months.

🩺 Key Takeaway

Private markets can offer healthcare professionals powerful tools for diversification, long-term growth, and alignment with real-world assets — but they require patience, due diligence, and understanding of each structure’s risks and rewards.