Privately-held describes a business entity, such as a corporation or limited liability company (LLC), whose ownership is not offered or traded publicly on a stock exchange. Instead, ownership is vested in a relatively small number of shareholders, often the founders, their families, and a select group of investors. These companies are not subject to the same extensive regulatory reporting requirements as their publicly-traded counterparts. Their financial information is often kept confidential, and shares are typically not freely transferable. The term is often used interchangeably with 'closely held'.
Privately-held meaning with examples
- The family-run bakery remained a privately-held business for three generations, allowing them to maintain control over quality and recipes without the pressures of quarterly earnings reports. This enabled them to make long term investments. This strategy, allowed them to prioritize their values. Keeping it 'privately-held' was key to this vision.
- After years of rapid expansion, the software company decided to remain privately-held. This decision allowed them to focus on innovation and product development without external shareholder demands. They believed this would allow them to compete more effectively. It was this vision that drove their ambitions.
- A group of investors acquired the struggling manufacturing plant with the intention of turning it into a privately-held enterprise. Their strategy involved restructuring operations and streamlining costs. This will give them control of their own destiny. They believed that this strategy would allow for long term success.
- Many venture capital firms invest exclusively in privately-held companies, recognizing the potential for substantial returns before an initial public offering. This approach, allows them to gain stakes in companies that are rapidly expanding. These investments allowed them to create wealth. Venture capital gives investors high return.
- Despite offers from larger corporations to acquire them, the founders decided to keep the consulting firm privately-held, valuing their independence and ability to make rapid, strategic decisions. They felt this was the only way to ensure long term growth. It enabled them to retain full control of their direction.