Private Placement

Private placement is a capital raising method that sells securities of a private company to accredited investors. Private placements do not require filing with the Securities and Exchange Commission and detailed financial information is not disclosed. Private placements are offered to a small number of investors and are usually a direct sale of securities between the issuer and the investor. Note that a private placement can also be done by a public company. For example, a public firm may do a private placement to issue new bonds.