In this study, I examine whether the public peer information environment has spillover effects on private firm capital raising and when the public peer information environment matters most. Private firms today raise large amounts of private equity and venture capital financing from investors while disclosing much less than their public firm counterparts. Legal scholars have proposed that this phenomenon is explained in part by private firms free-riding on information spillovers from the disclosures and pricing of their public peers, which assist private equity investors in firm valuation. Consistent with this argument, I find that private firms with close publicly traded peers receive larger equity financing deals than private firms without (or with fewer) public peers holding the percentage equity stake acquired constant, which suggests that these firms benefit from a lower cost of capital. Additionally, I find that the effect of public peers on private firms' cost of capital is largest (a) for private firms with less firm-specific information, (b) for leveraged buyouts and majority investors, (c) for investors that are less familiar with the private firm and its industry, and (d) for public peers with higher quality information environments characterized by lower information uncertainty. I interpret these results as evidence that increased public peer information is associated with lower costs of capital in the private equity markets, and the cross-sectional variation in this effect suggests that public peer information reduces the information asymmetry between private firm managers and private equity investors. Lastly, I investigate how cost of capital free-riding affects a private firm's life cycle and find that private firms with more publicly traded peers raise more capital in the private markets prior to going public.