In the corporate universe of the private sector, there are companies from family businesses to multinational companies, each with its own particularities.
A private company is a commercial company that is supported by the capital of one or more owners, shareholders or investors. Unlike public companies , which belong to the state (that is, they depend on the State and are managed by each government), private companies are part of the private sector. The latter are conceived as a business, since they have a lucrative nature and are committed to profitability .
It is easy to find, in everyday life, examples that help to understand what private companies are about, how they are organized and where they carry out their activities because, with a minimum of theoretical references, one can locate in one's neighborhood, city, province or country from a transportation company or a tourism company to a health company , a food and beverage company or a security company .
Types of private companies
The types of private companies are recognized based on the parameter analyzed.
If we focus on the size of the company, the categories of microenterprise , small and medium-sized enterprise ( SME ) and large enterprise become relevant. If the legal form is taken into account, however, the alternatives of Public Limited Company (SA) , Limited Company (SL) , Simplified Joint Stock Company (SAS) and Limited Liability Company (SRL) come into play.
The type of sector in which they are specialized to provide products and/or services, meanwhile, opens up a huge range of classification opportunities. A technology company , to detail an example, is one that has its strength in information and communications technologies (ICT) or takes advantage of applied sciences to innovate. When the latter occurs, generally in university environments or in a public corporation oriented to research and development, more than one derived company (baptized in English as spin-off ) is born based on the division of a company or a subsidiary segmentation of it. The modernization that goes hand in hand with new technologies is key to the establishment of an emerging company , popularly identified as a startup .
There is more than one leading multinational in the telecommunications and IT markets , such as Huawei and Microsoft , just as there are entrepreneurs and visionaries who are driving a robotics company , a virtual reality company and/or an artificial intelligence company .
When it comes to a business or enterprise dedicated to acquiring raw materials or goods in order to transform and market them, we speak of an industrial company . Included in this group are a manufacturing company , a mining company and any oil and gas company , to provide references.
Creating a service company with the aim of covering certain needs from an intangible asset (intangible and that must be renewed) is another possibility, whether it be a legal services company , an information and communication services company or a financial services company .
If we are talking about a consulting firm , finally, it is worth keeping in mind that this type of firm is consolidated as a professional services company capable of assisting and advising in numerous areas of work.
Zara, for example, is a successful fashion company with several franchises.
Business strategies and alliances
Business strategies and alliances abound in the business field. In order to increase corporate strength, eliminate competition or enter a new market, it is common for companies to merge and acquire . Sometimes, cooperation between entities from different sectors driven by the desire or need to strengthen certain commercial goals materializes in a strategic alliance .
By setting up a company from scratch or establishing a collaboration agreement between two companies, to describe another reality, the so-called joint company or joint venture is formed. It is also common to find, within the private sector , a modality identified as a franchise . This term is reserved to specify the format that allows the commercialization, for a specific period of time, of a service , product or good thanks to the fact that the franchised firm, through an agreement, gets the franchisor to let it make use of either a trade name, a brand or a business.
By delving deeper into theoretical notions that are linked to commercial activity, even the ideas of a subsidiary (a company characterized by being under the control of or depending on a main corporation called a parent company ) gain visibility. In the presence of a commercial company that owns or manages the properties of several corporations (something that happens when, for example, a group of capitalists invests in multiple profitable businesses), on the other hand, the concept of a holding company flourishes. Another situation that is easy to recognize on a daily basis on a global scale is represented by a word from the English language, outsourcing , which describes the outsourcing or externalization carried out by a company when hiring another to carry out a certain activity.
Strategic alliances benefit companies that work together towards the same goal.
Financing and capital of private companies
Financing and capital of private companies encompass a considerable number of possibilities. If agents of the private sector use their capital to carry out activities or ventures that provide them with monetary benefits, then the expression "private capital" becomes popular.
One should not overlook the specific features of an initial public offering ( IPO ), which allows a private equity company to issue shares for the first time, in the context of a public event, with the intention of obtaining income from investors who join the project.
In exchange for capital intervention, however, start-ups may be offered a "business angel" or "investor angel" who helps them grow. This business angel provides money to boost the initial stage of the corporate plan and advises or guides the owners of the company with the aim of embracing business success.