I searched the forum, but couldn’t find what I was looking for. Does anyone know of a PE book consisting mostly of case studies, with excel LBO models/sensitivities explained step by step ? The reason is that I want to break into PE, and I figure a PE interview (which typically includes a case study) is something that you practice for like a CFA exam, i.e. you just practice… So, anyone ? Thanks.
The Lerner casebook on Private Equity and Venture Capital is a good reference for case analysis. It doesn’t have excel stuff but the anecdotal analysis is helpful. For PE interviews, they’ll typically give you some financial data and historical context on a company, either by way of a data sheet or an investment memorandum, and ask you to build a basic LBO model and explain whether or not you’d invest. The Lerner book is a good start and probably the best thing to do is to try to get a hold of an actual investment memo and go over it with a friend that works in IB/PE. That’s what I did whilst preparing for interviews a while back.
Hey Numi, txs. But the touchiest part IS actually the LBO model, if they ask for that. I understand LBO case studies and models and I am pretty ok at the whole financial imputs / due diligence aspect. But I would build a sh!tty model if asked under pressure.
I don’t know for sure what you need to prepare for, but why don’t you go through the following process. 1) Write down for yourself what you think the key steps of doing an LBO model are, going into some detail so the steps aren’t too general. 2) Do a practice LBO model following some case study or online example, but with your own data (meaning you can find the raw data somewhere else, but don’t just copy the example - just use it as a guide). 3) Redo step (1), which probably has some extra insights now. 4) You’re much better prepared for the interview now. You can describe the main steps of the process and what is important, but you now can cover your butt by saying “this is a quick and dirty model so I can get it back to you quickly.” I would think you could knock this out in a weekend (or possibly a day).
Viceroy Wrote: ------------------------------------------------------- > Hey Numi, txs. > > But the touchiest part IS actually the LBO model, > if they ask for that. > Not necessarily. It does sound like your main area of weakness, but to say that the LBO model is the “touchiest” is not necessarily the case. Yes, they do want to see that you can competently build a model but in most cases, the model will be confirmatory rather than exploratory. What I mean is that when they give you a sheet of financials, you’ll generally be able to develop a feeling at first blush whether it’s a viable candidate well before building a model. Keep in mind that most PE folks don’t actually start running a model until they have a decent idea based on the qualitative aspects of the company whether it’s a go or a no-go. > I understand LBO case studies and models and I am > pretty ok at the whole financial imputs / due > diligence aspect. > > But I would build a sh!tty model if asked under > pressure. There’s no other substitute than practice. Find a basic template that you like, then de-construct and learn to build from scratch in the simplest form till you can get your time down to about 1.5 hours.
FYI you might also find some useful content on mergersandinquisitions.com – you should definitely check this out
^^ I’ll definitely check that out. Thanks you. Yeah I know the qualitative part is also quite important. A buddy of mine had to bla bla about target’s management for Christ’s sake.
I highly recommend “Private Equity and LBO Case Study” course on Udemy. Very well structured, only relevant materials and a lot of paper and full excel LBO case studies.