Management: management of company co invest with the private equity fund in the new equity of the acquired company, which aligns management's interests with the interests of the fund. In addition, management usually receive stock options This effectively eliminates agency issues and provides the incentive to work hard and create significant value. The end result is wealth creation for management if the are successful in managing the company until a successful exit is completed (usually three to seven years after acquistion). If problems develop during the holding preriod or if exits are significantly delayed, management will not only forego significant exit-related compensation but may also lose their job.