Quasi-Public Corporation
Categories: Incorporation
Just as centaurs are part man and part horse, quasi-public corporations are part public and part private. What this means is that the company itself is private, but it’s either backed by the government or performs some sort of government-related function.
There are approximately eighty-four bajillion examples of quasi-public corporations out there, but here are just a few:
- The airplane manufacturer that builds military aircraft
- The government-backed corporation that offers mortgage financing (think: Fannie Mae)
- The local U.S. Post Office branch that delivers our mail
- The utility company that brings irrigation water to nearby farms
- The tax-funded clinic that offers addiction treatment and recovery
Despite all the various forms a quasi-public corporation can take, they all have a few things in common. First of all, their employees are their employees, not the government’s. Second, they are almost always publicly traded. Third, even though they’re publicly traded and therefore have shareholders who want them to make as much money as they can, their primary purpose is always to make sure they’re adequately providing whatever good or service they provide to the public. And fourth (and this is so important that we’ve already mentioned it but we’re mentioning it again), they always have some sort of formal affiliation with the government or a government entity, either through their financing or their charter.
Related or Semi-related Video
Finance: What is a Private Investment Co...3 Views
Finance a la shmoop what is a private investment company Shh we are hunting [Elmer Fudd appears from a bush]
profits okay people it's private yes private private means not subject to
the onerous rules of public investing and all that regulation that is when [Definition of a private investment company]
it's only wealthy big boys and girls putting in their dough the presumption [Wealthy people giving money to the market]
is that they have their own lawyers their own risk tolerances their own Ivy
League education and they can figure out the deal on their very own they don't
need mama government training wheels the way the public does in public offerings [The public riding a bike as the stabilisers are taken off]
with publicly traded securities and so on like private wealthy educated
investors get treated differently than Jo farmer who you know just graduated [Guy talking as Elmer Fudd keeps appearing in the background]
high school so who all does this apply to like what's a private investor what
investment vehicles are involved well hedge funds you know those go to private
wealthy investors private equity funds same deal and venture capital funds same
deal why because they go bankrupt all the time you can lose all your money in [Money going down the toilet]
these things all the time and it happens and Joe Q public needs to be protected
from that and there's good and bad because in these funds also you can make [The government saves the public from a fire breathing dragon]
like a hundred times your money if you happen to win the one lottery ticket [Guy next to pile of money from Amazon stock]
that goes up a whole lot and that's what people focus on when they sell them so
Joe Q public at least according to government is to be protected from such
a volatility and there's other investment vehicles beyond these three
that get private attention away from the public but they have vehicles we can't [Elmer Fudd whispering]
tell you about