The Private Equity Case Study: The Ultimate Guide

[@financialmodeling]

The files and resources are all available at: www.mergersandinquisitions.com/private-equity-case-study/

[@Rock4Ever80s]

Thank you Brian! I'm receiving a case study tomorrow and will have 5 days to complete it and present it, it's a first for me and this helped me have a better idea of what I should expect 👊

[@financialmodeling]

Good luck!

[@ryanfernandes5859]

IN a similar situation this week- how'd it go for you?

[@alexh.4842]

this's so professional! hats off... I learned so much from here than from biz school..

[@financialmodeling]

Thanks for watching!

[@bear76917]

Best tutorial ever!! Thanks!! I love all of your videos!

[@financialmodeling]

Thanks for watching!

[@TheUnexcitingGuy]

A question: when doing the LBO model, what assumptions do you make on the debt you raise? How do you decide how much Senior vs less senior debt?

[@financialmodeling]

You can look up recent deals to get a rough sense of the multiples or percentages for each one. You can search for terms like "average senior debt leverage ratios leveraged buyouts 2024" and find a lot of reports on loan pricing, average leverage ratios, etc. If you can't find anything on this specific split, maybe use 60/40 for senior/junior debt assuming a normal leverage ratio.

[@karunsomeshwar1649]

Great video! Love the analysis! I work in the Private Equity Secondaries space (buying Limited Partner interest in existing Private Equity funds). The PE secondaries space is gaining a lot of traction as LPs look to redeploy their capital by selling their interests in PE funds. I would love to see a model on that in your channel (This involves detailed modeling of the PE fund’s future performance by modeling exit scenarios of top assets in the fund and what that means for the fund carried interest and potential return to the buyer/LP interest holder).

[@financialmodeling]

Thanks, but it's outside our core focus and there isn't much demand for that type of modeling (most people want to work in direct PE funds), so it's probably not going to happen anytime soon.

[@yoloyolo3003]

Hi, thank you very much for this tutorial! I have a question: I'm given 2 days (weekend) to create an investment PowerPoint for a infra (greenfield) MMPE shop. Would the process be similar to what you showed in this video (except usung proejct finance model instead of LBO)?

[@financialmodeling]

Similar, yes, but PF assets have very limited upside, so you would focus more on the downside risk, almost like a credit case study or investment recommendation. It's not how much you can earn, but how bad things can get if there's a cost overrun, construction delays, higher interest rates, operational problems, contract cancellations, etc.

[@boboboss9907]

Thanks for the insights. Is such a long case study to be expected for undergraduate PE internships?

[@financialmodeling]

No, unlikely.

[@T3AMKILL]

LOVE these videos. Thanks a lot!

[@financialmodeling]

Thanks for watching!

[@jeremyheat44]

Thanks Brian! What is the most efficient way of finding add-on targets? I imagine that can take quite a bit of time, especially if many of the targets are private

[@financialmodeling]

There is no efficient way. Capital IQ or PitchBook access helps, but you'll need to do a fair amount of research and will probably have to settle on some "representative" add-on acquisitions rather than specific companies.

[@tboateng7964]

quite a large chunk of these terms and ideas you're using seem relatively new to me. I have time to learn but before applying for an internship the graduate job route. Where should I start

[@financialmodeling]

mergersandinquisitions.com/private-equity/

[@ibrahimshamshad6451]

Great upload .. Thanks

[@financialmodeling]

Thanks for watching!

[@kolyiken]

Hi Brian. Very precise and thorough. Most likely to be interviewed for a type 1 or type 2 case study. Any recommendation where should I find examples of these sort? Thank you.

[@financialmodeling]

Thanks. We have other examples of LBO models and case studies in this channel if you do a search.

[@rafikhovsepyan3713]

Hi Brian, great to hear from you, thanks a ton! I remember you `ve covered free cash flow conversion rate previously, I think its also a viable financial metric to include in the company selection critetria..or will it be too much (overwhelm the commitee with metrics) - love to hear your say on this..

[@financialmodeling]

There is a video in this channel on Free Cash Flow Conversion... older but it's still there. Do a search.

[@rafikhovsepyan3713]

@@financialmodeling old, but gold ! thank you!

[@JJ-zy3zv]

Hello - thank you for this. Have a potentially dumb question. Would we ever get asked / would it be possible to build a mini case study for a private company? I'm obviously assuming no I just got access to a free trial capital IQ (I'm a consultant). And as expected for most private companies there is no (or limited) financial information. So doesn't seem practical for a PE case study to ever ask you to build a quantitative thesis for a private company. But wanted to be sure Thank you

[@financialmodeling]

A private company case study in a PE interview is unlikely unless they give you all the company's information. If it's open-ended, you pretty much have to select from public companies.

[@JJ-zy3zv]

@@financialmodeling thank you!

[@finbran7439]

I am your fan for sure

[@financialmodeling]

Thanks for watching!

[@ricardoalvanore7568]

Thanks for the info!

[@financialmodeling]

Thanks for watching!