Chapter 4 of Practical Finance for Property Investment examines how private equity partnerships can help an investor finance the acquisition of an investment property in situations where the investor needs additional capital above and beyond what is provided by a mortgage lender. The chapter uses examples to demonstrate typical features of private equity partnerships and explain terms such as the hurdle rate (or preferred return) and promote. Different private equity waterfalls illustrate the benefits to both investor equity and outside equity that are found in a hurdle and promote partnership structure. The chapter also distinguishes between a private equity deal and a private equity fund. In conclusion, the chapter presents a case study illustrating that a successful investment requiring outside equity must not only be a fundamentally attractive investment opportunity, but also must satisfy the risk-return thresholds of both inside and outside equity investors.