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Investment Case Study: Learning From Examples

This article is an excerpt from the Shortform book guide to "The Intelligent Investor" by Benjamin Graham. Shortform has the world's best summaries and analyses of books you should be reading.

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What’s an investment case study? Are there case studies out there that can help you understand failed investments?

An investment case study can help you understand what went wrong with certain investments. Sometimes, investments fail despite all your research. Other times, a failed investment is predictable.

Read these investment case study examples and what they can teach you about certain investments.

What Is an Investment Case Study ?

When choosing investments, it’s as important to avoid overhyped companies on the brink of failure as it is to choose bargain stocks . Graham shows four case studies of companies that had astronomical stock prices but showed clear warning signs of their impending demise. Moreover, to detect their weak conditions, you wouldn’t have needed to understand their intricate workings—you could have used the basic financial metrics we’ve covered already. To see these metrics in action, you can examine an investment case study.

Then, in his commentary, Zweig adds modern examples of each archetype.

The four archetypes shown are:

A giant company with signs of poor operating performance
An empire-building conglomerate that grows unwisely through acquisition
An acquisition where a small company absorbs a giant
A company with little substance riding a speculative wave

Investment Case Study Archetype 1: A Poorly Operating Giant

This is one example of an investment case study that shows how a large company can fail.

Penn Central

In 1970, the nation’s largest railroad company Penn Central filed for bankruptcy. This was shocking to the finance world, but Graham argues its demise could have been predicted well in advance :

The company had not paid income taxes for 11 years, yet it was regularly reporting earnings. How would this have been possible?
The standard interest coverage ratio (the ratio of earnings to interest charges) for railroads was 5:1 before taxes. In 1967 and 1968, Penn Central showed a ratio of just 1.9.
It was operationally inefficient. Railroad expenses made up 47.5% of its income in 1968, compared to 35.2% for a more efficient competitor.
Its accounting was fishy, with strange transactions that didn’t make much sense. Graham declines to go into detail.

Graham argues that anyone paying attention to the simple fundamentals of the business could have noticed that Penn Central was in deep trouble. At that time, they should have pulled their stock and bonds out of the company and exchanged them for more robust competitors.

Investment Case Study Archetype 2: An Empire-Builder that Falters

This is another example of an investment case study where an empire collapses. Note how it’s different from the above.

Ling-Temco-Vought

Ling-Temco-Vought was a conglomerate involved in industries as wide as aerospace, sporting goods, and pharmaceuticals.

(Shortform note: The conglomerate began with a young entrepreneur James Ling, who took his electrical contracting business public in 1955. From that point he began a blistering pace of acquisitions in a staggering array of industries. Taking advantage of low interest rates in the 1960s, Ling-Temco-Vought raised huge sums of debt to fund acquisitions. The strategy was relatively simple—as long as an acquired company’s earnings could cover the interest on debt used to acquire the company, the acquisition was profitable.)

The nominal growth in the company was staggering —revenue began at $7 million in 1958, grew twenty-fold within 2 years to $143 million, then grew again twenty-fold again to $2.8 billion by 1968.

Yet warning signs appeared through this steady rise :

The acquisitions required debt, which ballooned to $1.5 billion by 1969. This was a near-record amount across all companies in history (Shortform note: On the financial tables shown, its assets to liabilities ratio generally remained between 1.0 and 2.0.)
Its ratio of earnings to interest didn’t pass the conservative benchmark of 5.
Its market price in 1967 was a remarkable 22 times net tangible assets.

In 1969, at its peak in sales, Ling-Temco-Vought reported a loss of $70 million (it had earned $124 million before taxes and interest, but interest charges were $122 million, swallowing up nearly all the profits; additional taxes and special items caused further losses).

Over the next few years, the stock price fell from its peak by over 95%.

(Shortform note: Graham doesn’t comment on the company’s fundamental business issues. It appears Ling-Temco-Vought suffered from:

A general market downturn in 1970
Investors’ realization that its acquired companies weren’t growing any faster as part of the conglomerate than before they were acquired, thus weakening the conglomeration strategy
Antitrust concerns of conglomerates)

Archetype 3: A Tiny Company Swallows a Giant

This third investment case study shows what can go wrong when a large company takes over a smaller one.

NVF and Sharon Steel

In 1968, NVF, a company with $31 million in sales, acquired a company seven times its size : Sharon Steel Corp, a company with $219 million in sales.

To fund this acquisition, NVF issued $102 million of bonds with stock warrants attached. Warning signs then appeared:

Its financial reporting showed incomprehensible entries relating to debt expenses, cost of investment in Sharon Steel, and fair market value of warrants. The overall effect was to disguise the severity of the debt and of the dilution from the stock warrants.
The newly issued bonds soon traded at a steep discount (42 cents on the dollar), suggesting the market had deep concerns about its financial position.
In 1969 Sharon Steel adjusted its calculations for pension costs and lowered depreciation rates, thus artificially boosting earnings by $1 per share.

(Shortform note: Graham doesn’t discuss the stock performance of NVF, but Sharon Steel began defaulting on debt in 1985 and filed for bankruptcy in 1987. The chairman of NVF, Victor Posner, was a famed “corporate raider” and pioneer of leveraged buyout and hostile takeover strategies.)

Archetype 4: An Illusory Company Riding a Speculative Wave

Finally, this last type of investment case study shows how stocks can damage company value.

In 1999, Internet retailer eToys went public at a valuation of $7.8 billion. It was a tiny company with sales of just $30 million and assets of $31 million; in comparison, Toys “R” Us was worth $2 billion less at $5.6 billion, with 70-fold more revenue ($2.1 billion) and total assets of $8 billion.

How did this make any sense? eToys showed an astounding growth rate of 4,261% in the past year. However, as Graham has cautioned us, smaller companies are able to grow at astounding rates that they cannot sustain (a 42-fold growth in revenue suggests eToys had just $700,000 in revenue the previous year).

Even worse, while it showed revenue of $30 million, eToys suffered a loss of an equal size, at $31 million—it was losing a dollar for every dollar it brought in.

In 2001, eToys filed for bankruptcy, and its stock fell from $86 per share to zero.

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Carrie Cabral

Carrie has been reading and writing for as long as she can remember, and has always been open to reading anything put in front of her. She wrote her first short story at the age of six, about a lost dog who meets animal friends on his journey home. Surprisingly, it was never picked up by any major publishers, but did spark her passion for books. Carrie worked in book publishing for several years before getting an MFA in Creative Writing. She especially loves literary fiction, historical fiction, and social, cultural, and historical nonfiction that gets into the weeds of daily life.

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Investment Banking Case Study Examples – A Guide

If you are preparing for an investment banking interview, you’ll probably need to conquer a case study interview. because case studies are a very crucial component in the investment banking hiring process. particularly if you have never completed a case study before, that will be very challenging for you to get into the investment banking field. this article has covered everything you need to know about investment banking and potential investment banking case studies. there are also tips and practice investment banking case study questions with examples of how to resolve them..

Investment Banking Case Study Examples (1)

What is Investment Banking?

Investment banks are financial firms that perform a variety of tasks, including underwriting, assisting companies with the issuance of stock and debt securities through initial public offerings or fixed-priced offerings enabling mergers and acquisitions on both the buy side and sell side of the deal, corporate restructuring and many other tasks.

To efficiently complete these significant deals, a firm turns into an investment banker when it requires finance services. With some of the best benefits in the businesses, it is an extremely competitive industry.

How Does Investment Banking Work?

Investment banking offers services and serves as the middleman between businesses and investors and focuses mostly on shares and stock exchanges.

Investment banking services help big businesses and organizations in developing a successful investment strategy that includes accurate financial instrument valuation.

When a company conducts an IPO or initial public offering, an investment bank purchases the majority of the shares immediately on the firm’s behalf.

The investment bank, which is now serving as a stand-in for the company then sells these shares on the market. The investment bank improves the company’s revenue in this way while also making sure that all governing rules are observed.

The investment bank makes money by marking up the initial price of shares when selling them to investors, helping the organization in making the most profit possible from this activity.

If a circumstance in the market emerges where the stock becomes overpriced, the investment bank also runs the risk of losing money by selling the stock at a lower price.

An organization should assess its requirements and carefully consider all of its possibilities before seeking guidance from an investor banker. Before the company visits an investment bank, there are a few crucial considerations including the amount of capital being raised and the level of market competition. When the business has clarity in these areas, it can enlist the assistance of investment bankers to find new businesses to invest in.

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Benefits of Investment Banking

Investment banking assists big businesses in a variety of ways to make crucial financial decisions and make sure they maximize revenues. That’s the reason, Investment banks are a prevalent financial institution among these businesses and even governments.

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Investment banks effectively manage their client and provide them with the information they require regarding the advantage and disadvantages of investing their money in other businesses or organizations.
These banks serve as a bridge between the company and the investor, ensuring a rise in financial capital by helping in major financial transactions like mergers and acquisitions.
It conducts an in-depth analysis of the deal and project that will be undertaken by its customer to ensure that the client’s money is invested safely and helps to reduce the risks involved with the mentioned deal or project.

What is Investment Banking Case Study?

You must have solved case studies during your investment banking training.

Analyzing a business condition is done in case studies during investment banking interviews.

You would be provided with all the necessary data and have adequate time to examine broad case studies. There you would be asked for your opinion on business-related issues.

Your Task Includes,

Make the necessary deduction.
Investigate the matter, which is typically a client’s business.
Give suggestions for resolving the current issue along with an explanation.

Investment banking case studies are frequently used to evaluate a job candidate’s potential performance in real circumstances, where your interviewers would give you a problem and ask for a detailed recommendation.

By presenting them with a hypothetical scenario similar to those experiences while working in the field, your job is simply to analyze the scenario and give them justified reasons.

Case studies are typically presented at the end of the application process, most frequently at the final interview or during the assessment center.

The majority of questions in investment banking case studies revolve around acquisition, capital raising, or business growth.

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What Are the Types of Case Studies?

Take home investment banking case study.

You will probably receive the case in advance so you have more time to work on it before the assessment day.
In the case of take-home case studies, you are given a few days to work on them, complete your analysis, and showcase your recommendation to the bankers over a 30-45 minutes presentation.
It involves a much deeper analysis including merger/LBO modeling, company procedures, and valuation.

On the Spot or Blind Investment Banking Case Study

On the day of your assessment center, the case can be presented to you blindly with little time for preparation.
These are given to you on the day of your interview and within an hour or two you are supposed to present it on the spot.
The time split for this process would usually be 45-60 minutes of preparation, 10 minutes of presentation followed by a round of question and answer.
It would not involve such deep study.
Some case studies on investment banking may occasionally be given as a group task, where the employer will use this as an opportunity to examine the candidate’s analytical skills and teamwork qualities.

Why You Should Prepare for Investment Banking Case Study?

The theory behind these case studies is that because the qualification for various professions varies, bankers don’t trust the conventional method of interviewing applicants.

Case studies are preferred by banking recruiters as a better way to evaluate applicants because they show how you should perform in the workplace.

You don’t need to worry about whether your response is right or wrong in this situation because the interviewer is more interested in how the candidate thinks and how well they can use logic and analysis to come up with an innovative answer to the challenge at that time.

Investment banking case study writers aim to inspire applicants to come up with their ideas and apply critical thinking.

Candidates for these positions must have a variety of skills, but problem-solving ability is one of the most important.

Recruiters are interested in learning how you would approach difficult circumstances and use your intelligence, education, and professional experience to handle them successfully.

Additionally, candidates get an amazing chance to practice their other abilities including presentation, communication, and interpersonal skills.

These factors make case studies significantly more important than the other methods of evaluating applicants in the investment banking hiring process.

How to Prepare for Case Studies Before Assessment Day?

Read as much deal news as you can while preparing and going through the daily market and business news in popular publications.
Discover the many valuation methods, how they are calculated, and how they are evaluated then try out your calculations after watching YouTube videos or reading information on valuation methods.
You must prepare a structure using PowerPoint and Excel consistently, especially for modeling and valuation-based case studies.
Also, improve your familiarity with software like Microsoft Excel so that you can use spreadsheets effectively.
You should practice the kinds of questions you might get during your presentation.
Real case study interview questions used by banks might not be available to you.
But, knowing that you need to practice, consider contacting a colleague or friend, or mentor you know who has gone through case study rounds for the types of questions they were asked.

How to Solve It and Perform Well During Assessment Day?

To solve the case study, take an organized strategy.
Before making a conclusion or deciding how to solve the problem, carefully analyze the case and the questions.
Professionally prepare Excel and PowerPoint while modeling case studies.
Every assentation you make should be supported by solid logical arguments, and the first few points should address that case’s most important issues.
Even if is not necessary, it would be advantageous to have a specialized understanding of the industry being studied.
Do not beat around the bush as you have limited time and hence be precise as you speak.

Investment Banking Case Study Examples and Answers

The decision-making case and the financial modeling case are two main types of case studies used in investment banking assessments.

Modeling – Investment Banking Case Study

Modeling case studies are typically take-home tasks that require you to perform straightforward valuation and financial modeling.

So rather than being a case study, it is more of a modeling exam.

The investment banker gives an overview of creating models as well as developing a variety of methods for an in-depth and useful understanding of the subject.

The modeling case study will either use a simpler merger or leveraged buyout model or a free cash flow to the business valuation.

To assess whether the firms are overvalued or undervalued, you would be asked to examine their valuation multiples.

In most cases, you will be given a few days to finish your analysis. Then on the day of the interview, you must spend 30-45 minutes presenting your case to the bankers.

Because you will have more time to work on it, the analysis will be considerably more in-depth than in a client case or decision-making case study.

Evaluating Strategic Alternative: Case Study 1

To maximize shareholder value, a magazine publisher is deciding whether to sell, grow organically or make tiny “tuck-in” acquisitions. It is looking for an investment bank to assist it with its alternatives and has asked for a presentation from your company.

Given Materials:

They would provide you with a firm summary with financial statements and five-year forecasts, a ten-page market analysis with main competitors, minor acquisition candidates, and recent transactions.

First, go through everything to get a sense of the industry, where it’s going, and how much this firm is worth in comparison.
Complete a quick assessment using publicly available rivals and prior transactions and a DCF.
Evaluate the figures provided by the value, the company’s potential for organic growth, and the availability of suitable targets for acquisition.

Decide what to do, in most cases it is advisable to say “Sell” unless the industry is expanding rapidly (Above 10% annually) the company is completely undervalued, or these are acquisition candidates that will increase revenue or profit by at least 20-30%.

After you have come to a decision, you must prepare your presentation and decide what to tell the bankers.

If you are analyzing scenarios like this during a 30-minute presentation, choose 10 slides with 3-4 important themes each and attempt to spend 3-4 minutes on each slide.

If you choose to write “Sell the company”, consider the following steps in preparing a presentation:

List the three main reasons for recommending selling
Overview of the industry- Is it expanding? Falling off? Or Being Inactive?
Position of the company in the industry? Leader or Second level position? Or is it strong or weak?
What would organic growth look like in five to ten years? How much larger or more valuable would the company be?
Prospective tuck-in acquisition candidates
Why organic growth and acquisition are not the answers.
Why selling now will generate the most shareholder value
Show prior transactions and public comparable valuations
Display the DCF output and the sensitivity chart valuation
Summary- State again that the best course of action is to sell your company right away and that neither organic development nor the acquisition of smaller firms would increase your company’s valuation in five to ten years.

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Decision Making- Investment Banking Case Study

Case studies that include decision-making are more common than case studies that involve modeling.

In this kind of case study, the applicant is required to decide for their client and offer advice.

The client case study can center on locating financial sources or determining whether or not a proposed merger should go forward.

At the interview, you should be prepared for these questions. Because you will have a set amount of time in which to examine and present the case. You will be given a total of 45-60 minutes to prepare and beforehand 10 minutes presentation with a Q&A round.

Case Study 1

A customer owns her company fully and wants to release some liquidity while keeping a stake in it (Worth £400 million) what suggestions would you provide the client to get the best possible price?

Given Materials:

A corporate overview and details about the company’s performance over the last three years are provided.

Examine all financial information thoroughly and forecast the company’s organic development.

Consider the breakdown of the present valuation if you are provided with the relevant facts.

Think about the client’s industry and the expected trends for that market.

How does the valuation stack up against others in the field?
Is the current valuation backed up by reliable industry forecasts?
Given the slow development of the industry, would it be wise to give up more equity?
Is it expected that this industry will keep growing?

Consider present customer portfolios, projects, etc., while deciding whether any actions could be performed to boost the company’s value.

Think about suggestions for the client’s negotiation strategy:

How much equity should they be prepared to give up?
What number should the client choose as their actual reserve price, in your opinion?

Case Study 2

A publicly traded firm contacts you in the hope to raise money. Analysts’ expectations were met by recent profits and the latest financial report, but the company’s market values are lowest throughout the year. The management of the company has developed a project that it hopes would significantly boost EBIDTA and is looking to raise funding for it. What should the business do to raise the required capital?

Given material:

A summary of the business and its financial statements will be provided to you to prepare for this question.

You must think about whether the organization should raise debt or stock.

Think about the market capitalization, share count, and share price:

How would the company be affected in this environment if it issued fresh shares?
In terms of dilution of ownership, would equity financing be an appropriate option?
How would the effect currently differ from what it would be if the share price were back to normal?

Then examine the provided financial statements:

Would increasing debt be a better course of action if they are actually under management’s predictions?
How much they could possibly raise?
What potential problems could a debt increase bring about?
How could the cost of interest be reduced?

Prepare your presentation by organizing your ideas clearly and go through your questions and thought process to get at your recommendation.

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Potential Acquisition: Case Study 3

A software company is considering a large acquisition. It has chosen the company it wishes to acquire and has contacted a number of investment banks to obtain their thoughts on the transaction and how much they should pay. Based on these presentation, it will choose an advisor and decide what to do.

Two page summaries of the buyers and seller, each containing financial data as well as statistics and multiples for similar organization.

With a recommendation on whether to move forward with the acquisition and if so, how much to pay for the target, create five minute presentation.

For the very first, you should consider this two question to solve this,

Should they purchase that target business?
What price should they want for the target business?

For an example,

Let’s assume that the comparable companies are trading at EBITDA multiples that range from 4 to 8 times, with the median at 6 times and the 75th percentile at 7 times, respectively. You choose the 25th to 75th percentile range of 5x-7x and apply it to the target company’s $10 million EBITDA since the target company’s profit margins and revenue growth are comparable.

Therefore, the purchase price should range between $50 million and $70 million.

If you have access to a computer, you can also design a DSF, but if you are short of time, keep it straightforward and use multiples.

To answer the question “Should they buy?” take note of the following:

Will the buyer be able to purchase the seller with enough cash, debt, or stock issuances?
Will the vendor increase the buyer’s revenue and profit?
Will the buyer benefit from new consumers, new goods, new markets, or other kinds of benefits as a result of the seller’s acquisition?

After concluding these, you can complete your presentation.

Investment Banking Case Study: FAQs

Q. what is an investment banking case study in short terms.

By presenting candidates with a hypothetical scenario that is comparable to those they might face on the job, investment banking case studies are frequently used to evaluate how the candidate would function in real circumstances.

Q. Which skills are tested in investment banking case study interviews?

Candidates’ analytical and financial skills as well as problem-solving, presentation skills, critical thinking, and interpersonal skills are tested during investment banking interviews.

Q. Is there any way to practice investment banking case studies?

There are various tools, financial modeling online courses, and investment banking textbooks accessible to practice investment banking case studies. Additionally, there are certain career services offered at universities and institutions that provide investment banking programs with case studies.

Investment Banking Case Study: Conclusion

The opportunities to demonstrate your abilities and expertise to investment bankers are provided by investment banking case studies, which are a crucial component of an interview process.

We have covered some of the investment banking case study examples that will help you in preparation for an investment banking interview.

No doubt it is a very competitive yet tough field to break into but we hope, through this article you achieve the success ladder in the investment banking industry.

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Private Equity Case Study: Example, Prompts, & Presentation

Private equity case studies are an important part of the private equity recruiting process because they allow firms to evaluate a candidate’s analytical, investing, and presentation abilities.

In this article, we’ll look at the various types of private equity case studies and offer advice on how to prepare for them.

This guide will help you ace your next private equity case study, whether you’re a seasoned analyst or new to the field.

Types Of Private Equity Case Studies

Case studies are very common in private equity interviews, and they are a key part of the overall recruiting process.

While you’re extremely likely to encounter a case study of some kind during your recruiting process, there is considerable variety in the types of case studies you might face.

Below I cover the major types:

Take-home assignment

In-person lbo modeling assignment.

For this case study, you’ll get some company information (e.g. a 10-K or a CIM) and be asked to assess whether or not you’re likely to invest.

Generally, you’ll get between 2-7 days to prepare a full presentation or investment memo with your recommendations that you’ll present to the interviewer. To support your investment recommendation, you’ll be expected to complete a full LBO model . The prompt may give certain details or assumptions to include in the model.

This type of test is most common during “off-cycle” hiring throughout the year, since firms have more time to allow you to complete the assignment.

This is pretty similar to the take-home assignment. You’re given company materials, will build a financial model, and decide whether you would invest.

The difference here is the time you’re given to complete the case. You’ll generally get between two to three hours, and you’ll typically complete the case study in the firm’s office, though some firms are becoming newly open to completing the assignment remotely.

In this case, you’ll typically only complete an LBO model. There is usually no presentation or investment memo. Rather, you’ll do the model and then have a short discussion afterward.

This is a shorter, more condensed version of an LBO model. You can complete a paper LBO with a piece of paper and a pen. Alternatively, you may be asked to discuss it verbally with the interviewer.

Rather than using an Excel spreadsheet, you use an actual sheet of paper to show your calculations. You don’t go into all the detail but focus on the essence of the model instead.

In this article, we’ll be focusing on the first two types of case studies because they are the most widely used. But if you’re interested, here is a deep dive on Paper LBOs .

Private Equity Case Study Prompt

Regardless of the type of case study you’re asked to do, the prompt from the interviewer will ultimately ask you to answer: “would you invest in this company?”

To answer this question you’ll need to take on the provided materials about the company and complete a leveraged buyout model to determine whether there is a high enough return. Generally, this is 20% or higher.

Usually, prompts also provide you with certain assumptions that you can use to build your LBO model. For example:

Pro forma capital structure
Financial assumptions
Acquisition and exit multiples

Some private equity firms provide you with the Excel template needed for an LBO model, while others prefer you to make one from scratch. So be ready to do that.

Private Equity Case Study Presentation

As you’ve seen above, if you get a take-home assignment as a case study, there’s a good chance you’re going to have to present your investment memo in the interview.

There will usually be one or two people from the firm present for your presentation.

Each PE firm has a different interview process, some may expect you to present first and then ask questions, or the other way around. Either way, be prepared for questions. The questions are where you can stand out!

While private equity recruitment is there to assess your skills, it’s not all about your findings or what your model says. The interviewers are also looking at your communication skills and whether you have strong attention to detail.

Remember, in the private equity interview process, no detail is too small. So, the more you provide, the better.

How To Do A Private Equity Case Study

Let’s look at the step-by-step process of completing a case study for the private equity recruitment process:

Step 1: Read and digest the material you’ve been given. Read through the materials extensively and get an understanding of the company.
Step 2: Build a basic LBO model. I recommend using the ASBICIR method (Assumptions, Sources & Uses, Balance Sheet, Income Statement, Cash Flow Statement, Interest Expense, and Returns). You can follow these steps to build any model.
Step 3: Build advanced LBO model features, if the prompts call for it, you can jump to any advanced features. Of course, you want to get through the entire model, but your number 1 priority is to finish the core financial model. If you’re running out of time, I would skip or reduce time on advanced features.
Step 4: Take a step back and form your “investment view”. I would try to answer these questions:
What assumptions need to be present for this to be a good deal?
Under what circumstances would you do the deal?
What is the biggest risk in the deal? (e.g. valuation, growth, and margins).
What is the biggest driver of returns in the deal? (e.g. valuation, growth, and debt paydown).

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How To Succeed In A Private Equity Case Study

Here are a few of my tips for getting through the private equity fund case study successfully.

Get the basics down first

It’s very easy to want to jump into the more complex things first. If you go in and they start asking you to complete complex LBO modeling features like PIK preferred equity, getting to that might be on the top of your list.

But I recommend taking a step back and starting with the fundamentals. Get that out the way before moving on to the complicated stuff.

The fundamentals ground you, getting you through the things you know you can do easily. It also gives you time to really think about those complex ideas.

Show nuanced investment judgment; don’t be too black-and-white

When giving your investment recommendation for a private equity fund you shouldn’t be giving a simple yes or no.

It’s boring and gives you no space to elaborate. Instead, go in with what price would make you interested in investing and why. Don’t be shy to dig in here.

Know where there is a value-creation opportunity in the deal, and mention the key assumptions you need to believe to create that value.

Additionally, if you are recommending that the investment move forward then bring up things you would want to know before closing a deal. You can highlight the key risks of the investment, or key things you’d want to ask management if you could meet with them.

At the end of the day, financial modeling is a commodity skill. Every investor can do it. What will really set you apart is how you think about the deals, and the nuance you bring to analyzing them.

You win by talking about the model

Along those lines, you don’t win by building the best model. Modeling is just a check-the-box thing in the interview process to show you can do it. The interviewers need to know you can do the basics with no glaring errors.

What matters is showing that you can discuss the investment intelligently. It’s about bringing a sensible recommendation to the table with the information to back it up.

How Do I Prepare For A Private Equity Case Study?

There is no one-size-fits-all when it comes to preparing for a private equity case study. Everyone is different.

However, the best thing you can do is PRACTICE, PRACTICE, and more PRACTICE!

I know of a recent client that successfully obtained an offer from multiple mega funds . She practiced until she was able to build 10 LBO models from scratch without any errors or help … yes, that’s 10 models!

Now, whether it takes 5 or 20 practice case studies doesn’t matter. The whole point is to get to a stage where you feel confident enough to do an LBO model quickly while under pressure.

There is no way around the pressure in a private equity interview. The heat will be on. So, you need to prepare yourself for that. You need to feel confident in yourself and your capabilities.

You’d be surprised how pressure can leave you stumped for an answer to a question that you definitely know.

It’s also a good idea to think about the types of questions the private equity interviewer might ask you about your investment proposal. Prepare your answers as far as possible. It’s important that you stick to your guns too when the situation calls for it, because interviewers may push back on your answers to see how you react..

You need to have your answer to “would you invest in this company?” ready, and also how you got to that answer (and what new information might change your mind).

Another thing that gets a lot of people is limited time. If you’re running out of time, double down on the fundamentals or the core part of the model. Make sure you nail those. Also, you can make “reasonable” assumptions if there’s information you wish you had, but don’t have access to. Just make sure to flag it to your interviewer

How important is modeling in a private equity case study?

Modeling is part and parcel of private equity case studies. Your basics need to be correct and there should be no obvious mistakes. That’s why practicing is so important. You want to focus on the presentation, but your calculations need to be correct first. They do, after all, make up your final decision.

How can I stand out from other candidates?

Knowing your stuff covers the basics. To stand out, you need to be an expert in showing how you came to a decision, a stickler for details, and inquisitive. Anyone can do the calculations with practice, but someone who thinks clearly and brings nuance to their discussion of the investment will thrive in interviews.

Private equity case studies are a difficult but necessary part of the private equity recruiting process . Candidates can demonstrate their analytical abilities and impress potential employers by understanding the various types of case studies and how to approach them.

Success in private equity case studies necessitates both technical and soft skills, from analyzing financial statements to discussing the investment case with your interviewer.

Anyone can ace their next private equity case study and land their dream job in the private equity industry with the right preparation and mindset. If you’re looking to learn more about private equity, you can read my recommended Private Equity Books.

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The Venture Capital Case Study: What to Expect and How to Survive

If you're new here, please click here to get my FREE 57-page investment banking recruiting guide - plus, get weekly updates so that you can break into investment banking . Thanks for visiting!

There’s plenty of information online about case studies in finance interviews (IB, PE, etc.), but the venture capital case study remains a bit mysterious.

Depending on your source, a VC case study might consist of a “ cap table ” exercise where you calculate the company’s ownership over many investment rounds and the proceeds to each group upon exit…

…but it could also be a qualitative discussion of a market, an evaluation of a specific startup, or even a simple 3-statement model .

But if you’re interviewing at an early-stage VC fund (i.e., Seed and Series A investments), the most common type is the “Evaluate a startup and recommend investing or not investing” one.

The VC firm might give you a short investment memo or slide deck for the company, ask you to read it, and then say “yes” or “no” based on your analysis and interpretation.

We’ll go through a short example for a fictional startup called PitchBookGPT , which comes directly from our new Venture Capital & Growth Equity Modeling course .

This is a summary version, but it should be enough to give you some practice:

Video Table of Contents:

Startup / saas valuation, the video tutorial and the files.

If you prefer to watch or listen to this tutorial, you can get the 14-minute video walkthrough below:

If you prefer to read, you can continue with this article.

You can get the files, including the company’s pitch deck, here:

PitchBookGPT – Seed Round Pitch Deck (PDF)
Venture Capital Case Study Prompt (PDF)
Venture Capital Case Study Solutions and Investment Recommendation (PDF)
Case Study Walkthrough and Explanation – Slides (PDF)
SaaS Valuation Multiples and Historical Data (PDF)
0:00: Introduction
1:58: Part 1: What to Expect in VC Case Studies
3:10: Part 2: What Do VCs Want in Early-Stage Investments?
4:51: Part 3: “The Numbers” for PitchBookGPT
8:16: Part 4: The Market, Product, and Team
11:45: Part 5: Recommendation and Counter-Factual
13:04: Recap and Summary

This Venture Capital Case Study Example: PitchBookGPT

In short, this startup is riding the AI hype train and plans to offer a subscription service that will automate parts of the pitch book creation process at investment banks.

It won’t replace Analysts or Associates because it can’t create entire presentations with all the correct details.

But it speeds up the process by generating slide templates based on your queries, presentation data, and free examples on the sec.gov site .

For example, if you type in “ SPAC vs. IPO ” or “Market overview slide with monetary and fiscal factors,” the software will generate sample slide images, and you can click the one you want to get an editable PowerPoint version:

The “artificial intelligence” part comes in because simple keyword searches do not work well when searching for specific slides; a slide’s purpose often differs from its text .

Also, machine learning could work well for a problem such as converting slide images into editable PowerPoint templates.

This is much trickier than it sounds for moderately complex slides, and a rules-based system is less efficient than using huge data sets for the image-to-slide translation.

This startup claims that its service can boost Analyst productivity by 30% and generate millions in extra fees for the average bank, and it plans to sell it to boutique banks for $2,000 per month.

They want a $2 million seed investment at a $20 million post-money valuation, meaning that we (the VCs) will own 10% if we invest.

So, should we do the deal?

What Do Venture Capitalists Look for in an Early-Stage Investment?

To answer this question, you need to think about what early-stage VCs look for in deals.

Most early-stage companies do not have revenue, but they do have markets and teams .

Since early-stage investing is so risky, VCs seek opportunities with the potential for very high cash-on-cash multiples , such as 10x in Series A rounds or 100x in Seed rounds.

To be clear, these are the targeted multiples.

Most startups fail, and even the ones that succeed do not come close to a 100x multiple in most cases.

Since this failure rate is so high, early-stage VCs need to aim high by finding companies with the potential to serve huge markets.

Here’s a summary of the different stages:

Venture Capital Investment Criteria and Targets by Stage

Since the asking valuation is $20 million, we can reframe this case study as:

“Could this company potentially reach 100x that valuation, or $2 billion? If not, what about something like 10 – 20x, for a $200 – $400 million valuation?”

You can answer this question by doing some quick math and qualitatively evaluating the market, product, and team.

Venture Capital Case Study, Part 1: The Numbers

In its slide deck, this company claims that there are ~4,000 boutique banks worldwide with 1 – 20 employees and that these banks alone can support a $100 million market size (since 4,000 * $2,000 / month * 12 months = $96 million).

They plan to target these smaller and mid-sized banks because they’re easier to reach and they have fewer resources for pitch book creation.

But this company makes a common mistake with this claim: it assumes it will capture 100% of this market.

That never happens in real life, even in a narrow niche like this one – because there are competitors and many firms that don’t need the product.

In large markets (tens or hundreds of billions of dollars), capturing even a tiny percentage might be a good result.

In a narrower market like this one, something like 10 – 20% might be plausible if the company executes well.

That means a more realistic revenue estimate is $10 – $20 million.

Subscription software companies are usually valued based on a multiple of annual recurring revenue (ARR) , and this multiple is typically between 5x and 10x for public companies (more on SaaS accounting ):

If we apply these multiples to the company’s revenue estimates, we get a valuation range of $50 million (5x * $10 million) to $200 million (10x * $20 million).

This is a great result for the company, but it’s far below what most seed-stage VCs want.

A $50 million exit value would be a 2.5x multiple, while a $200 million exit value would be a 10.0x multiple.

And these numbers represent the potential outcomes and assume that everything goes well.

Also, these numbers do not account for the dilution in future funding rounds.

This 10% ownership will likely fall to 7%, 5%, or even 3% as the startup raises money in the Series A, B, and C rounds, which means even lower returns multiples.

You might say, “OK, but couldn’t this company’s revenue go much higher? They should charge per user , not per firm, for this service” (so the Average Revenue per User would be higher).

And that leads us to the next point about the qualitative evaluation of the market, product, and team.

Venture Capital Case Study, Part 2: The Market, Product, and Team

I wouldn’t say this company’s product is “terrible” – I’ve seen much worse startup ideas.

But it faces a “no man’s land problem” because the ideal customers differ from the reachable customers .

Boutique banks tend to be much more cost-conscious than large firms and don’t necessarily want to add a $2,000 monthly expense for multiple employees.

If a boutique bank needed this service for 5 Analysts, $2,000 per user per month would mean $120K per year , which is about the cost of hiring a full-time Analyst.

Many small banks would look at this and say, “OK, it speeds up presentations… but for that price, we could hire another Analyst and get client support, Excel work, and more.”

Also, small banks depend far less on long and detailed pitch books than large banks.

Most new deals come from longstanding relationships, not inbound inquiries or bake-offs / beauty pageants .

PitchBookGPT could target large banks ( the bulge brackets ) instead, as they are more willing to pay for training and productivity tools.

This service would be more useful for large firms because they tend to produce the 100+ slide pitch books where automation tools could save time.

However , it’s also much more difficult to close deals in this market, and compliance concerns mean these banks are less willing to share their data with external parties.

Could you imagine Goldman Sachs or Morgan Stanley uploading all their pitch books and slides to a VC-funded startup that may not even exist in a year?

Here’s my summary of the product/market fit problem:

Venture Capital Case Study - Product and Market Fit

Other Points in This Venture Capital Case Study

We don’t have time to analyze the team or the expected use of funds for this $2 million investment, but you would consider both in real life.

In short, they’re “fine but not amazing” – some of the budget numbers seem a bit too low (e.g., for the engineers), while others are on the high side (sales & marketing), but nothing seems completely crazy.

Similarly, the team (all fake names and bios) has relevant experience but looks a bit “junior,” so we’re neutral on them.

Our Final Decision

In short, we’d say no to this deal because we think a 100x multiple in any reasonable time frame – such as 5 or even 10 years – is implausible.

A 5 – 10x multiple might be feasible, but that’s not a great “stretch goal” for a seed-stage deal.

To reach a $1 – 2 billion valuation, the company would need hundreds of millions in annual revenue, and we don’t think that’s realistic for its business model and market.

The company could develop a different product or offer higher-end services to larger firms, but it doesn’t even have a “Version 1.0” yet, so that would be putting the cart before the horse.

You can view the full recommendation here .

What Would Change Our Mind?

If a few factors were different, we might be more inclined to recommend this deal:

Per-Seat Pricing – Maybe they can’t charge $2,000 / user / month, but even something like $1,000 / user / month could increase potential revenue at many firms.
Lower Asking Price – While a $2 million seed investment at a $20 million post-money valuation is not unheard of, it is aggressive. If the asking valuation were only $5 – 10 million, the deal math would be more feasible (maybe not for a 100x multiple, but something like 20 – 30x).
Higher-End Product – For example, banks might be willing to pay more if this product could replace employees rather than just boost their productivity. But that would require far more capital to develop and might require technology that doesn’t exist.

The Venture Capital Case Study: Final Thoughts

In short, unlike many startups, this PitchBookGPT idea isn’t necessarily “bad.”

There are proven markets for productivity tools, slide templates, and reference models in both PowerPoint and Excel.

But the problem is that this isn’t a great early-stage VC idea – at least not for the deal terms the company wants.

That’s not great news for this fictional company, but it is reassuring if you’re a junior banker worried about getting replaced by AI anytime soon.

It probably won’t happen – and in the near term, these new tools might even improve your life.

If you liked this article, you might be interested in:

The Growth Equity Case Study: Real-Life Example and Tutorial
The Full Guide to Healthcare Private Equity, from Careers to Contradictions
Healthcare Investment Banking: The Best Group to Check Into When Human Civilization is Collapsing?

About the Author

Brian DeChesare is the Founder of Mergers & Inquisitions and Breaking Into Wall Street . In his spare time, he enjoys lifting weights, running, traveling, obsessively watching TV shows, and defeating Sauron.

Free Exclusive Report: 57-page guide with the action plan you need to break into investment banking - how to tell your story, network, craft a winning resume, and dominate your interviews

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2 thoughts on “ The Venture Capital Case Study: What to Expect and How to Survive ”

This was a good read!

I noticed that you have a typo under the “slide dick”, right after the header of part 1 case study – or was that meant to be intentional ?

Thanks for pointing that out (fixed now). Nope, not intentional, somehow both spelling and grammar check missed it, and so did I (one issue when you stare at these documents all day…).

Master Cap Tables and Startup Modeling

Learn VC and growth equity financial modeling via 5 short case studies and 4 extended case studies on everything from AI to SaaS to biotech.

Case Study: Building an investment strategy to better serve multiple generations

The Whitlock family wealth came from the sale of legacy real estate holdings. In the seven years following the initial liquidity event, the wealth was managed by two investment banks. The family’s portfolio was made up of multiple trusts of different sizes, invested mostly in US stocks, ETFs, Treasuries, and municipal bonds. The investments in the children’s trusts mostly paralleled those in the parents’ portfolios—all invested with the goal of wealth preservation. No member of the family was a professional investor; they had little experience in making investment decisions at scale.

CLIENT BRIEF

Client : Whitlock family
Source of wealth : Legacy family real estate investments
Situation : Seeking a portfolio strategy that serves the interests of multiple generations
CA relationship : Discretionary portfolio management

The mother, Jane, was the family’s financial decision-maker, but her children—having reached their 40s and in the midst of building families of their own—wanted to become more involved in managing the family’s wealth. After investing in a local startup, one of the daughters became intrigued by the opportunity to capitalize on new and emerging innovation to boost the return potential of investments. She wondered if there was a place for this type of investing for the family more broadly, and if the family’s current providers were capable of, or experienced in, private investing for families. A period of market volatility spurred the second generation’s concern further, causing them to wonder if the family’s assets were receiving the sophisticated thinking and hands-on management they needed.

CLIENT NEEDS

The Whitlock family asked Patrick, their estate planning attorney and trusted friend, to help them find a firm that could provide:

Strategic investment guidance : An objective assessment of the family’s investment approach and its fit to the family’s objectives
Access to a more sophisticated, broader set of investment ideas : Advice on, and exposure to, more global private and public investment opportunities
Family wealth experience: An understanding of private clients, and experience in working with multiple generations, especially those who intend to transition decision making
Personal and trustworthy counsel: A trusted sounding board and partner for both the parents and children, and a direct relationship with the person making investment decisions for their portfolio

Through his own professional advisor network, Patrick was familiar with Cambridge Associates (CA) and our expertise working with family investors. He introduced the Whitlocks to Daniel, an Investment Director at CA.

OUR SOLUTION

After a series of exploratory meetings, Daniel took on the role of lead Investment Director for the Whitlocks’ dedicated CA team. With other members of this team, Daniel conducted a full Family Enterprise Review, which entailed an extensive assessment of the Whitlocks’ family wealth ecosystem, including their assets; investment structures and vehicles; goals and interests; spending and cashflow requirements; time horizons and risk tolerance; family wealth decision-making and governance structure; and operational needs. (See Portfolio Construction: A Blueprint for Private Families for additional insight into how we build portfolios and our family enterprise review process. )

During the enterprise review and conversations with the family, Daniel understood that Jane’s preference for a larger allocation to safer, more conservative, investment choices was rooted in her desire to preserve the family’s wealth for future generations. However, in running several scenarios and spending analyses with the family’s assets, Daniel was able to demonstrate that, for the Whitlocks’ expanding family (including grandchildren) to enjoy such opportunities, the family’s wealth would need to grow significantly more than could reasonably be expected of their existing portfolio approach. While this conservative approach had been seen as the surest way to protect and preserve wealth, the CA team’s thorough explanation and in-depth scenario testing helped reveal that such an approach would likely instead erode wealth over time, especially as the wealth was disbursed across multiple family members.

Through their discussions with Daniel and his team, the Whitlocks learned about opportunities to compound their wealth at a higher rate without significantly increasing their risk profile, while still maintaining enough liquidity and a balance of risk-mitigating assets to weather an extended market downturn. CA recommended a portfolio structure of 75% equities, including new allocations to private assets, and 25% in protection and safety-oriented assets.

In addition, Daniel highlighted for the family how combining their trusts into a pooled family investment vehicle could not only provide cost savings and other efficiencies, but also the scale needed to access institutional-quality investment opportunities to support long-term growth targets. Otherwise, asset levels from individual trusts would have been too small to be attractive to most top-tier private equity and venture managers. The family’s investment committee was then formed to include both generations of family members. As part of this process, Jane appreciated CA’s help in educating the next generation on the full extent of the family’s wealth, which she had been uncertain of how to communicate on her own. She found the enterprise review process useful in clearly and objectively sharing this information, and the next generation’s role in governance of the LLC as the ideal way to engage her children in the responsibilities of significant wealth ownership.

The parents are happy that their children are taking a more active role in the family’s finances and that the new asset allocation is designed to improve the likelihood that future generations can enjoy the same financial security that the core family members have experienced. The family has enjoyed the opportunity to learn more about active investing in both public and private markets, and the benefits of a hands-on approach to managing their family’s wealth.

Looking ahead, the family is progressing toward its targeted positions in venture capital and private equity investments. On the safety- and protection-oriented side of the portfolio, Daniel has established fixed income and hedge fund positions designed to provide diversification and volatility reduction benefits, especially during times of market dislocation. Outside of transitioning the investment portfolio to CA, the family is becoming more active in its philanthropic ventures, with the next generation expanding their roles in the family’s charitable giving and considering creating a family foundation.

This narrative has been fictionalized to ensure anonymity, but is based on actual client work.

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ESG | The Report

What is an Investment Case Study and Why Do You Need One

The more time you have to grow your money, the better chance of a successful outcome. Investing starts with saving and planning for what you want out of life: a retirement fund, a child’s education, or just enough money to buy that dream house someday. It helps if you know how the markets work and it means deciding how much risk is right for you and then taking action:

investing in stocks and bonds
through mutual funds
Investing on your own
buying real estate
starting a business
putting money into gold or other precious metals
managing your cash flow by using savings accounts
certificates of deposit (CDs)

The one thing every investor needs: an investment case study

What not to do with your investments.

The 8 main components of an investment case study

What are ESG considerations?

How investment case studies for ESG investments are different

How do I achieve this?

How to determine the return on investment for esg investments, what is a discount rate and how it can be used in an investment case study, how a ratio analysis is used in an investment case study.

Why it’s important to invest in ESG considerations alongside other investments
Why it’s important to have a diverse portfolio

How to reduce risk by diversifying your portfolio

How can valuing metrics be used to reduce risk in a portfolio, what is a discounted cash flow and how it can be used as a valuation metric, what is free cash flow and how can it be used as a valuation metric, how esg considerations are financially valuable, what factors you should consider when investing, how do you do a private equity case study, how each of these categories differ, what kind of return do you get on private equity investments, what you should consider before investing in private equity, what is a real estate case study and why do you need one, what factors you should consider when investing in real estate, what kind of return do you get on real estate investments, how do you write a case study solution, what is a problem-solving case study, caveats and disclaimers.

Before we begin, let’s clear up a common misconception: an investment case study is not like a business case study. A business case study analyzes the feasibility of opening a new branch for Starbucks or choosing between leasing and buying software; an investment case study helps you decide how much money to invest and where.

If your employer offers a 401(k) or RRSP plan, you might already have a case study that tells you how much they will match if you contribute. Don’t stop there: investigate your options for other types of accounts and the various investment vehicles available, such as stocks, bonds, mutual funds, real estate, precious metals, and so on.

You cannot put all your eggs in one basket, whether you invest through a financial advisor or make decisions on your own. Putting all your money into a single stock is a risk that could cost you everything if the company goes under. By diversifying your investments, you can minimize exposure to losses from financial shifts and other circumstances outside of your control. You need to consider what risks are involved, how each investment will grow (or not), and what the best time is to buy. So let’s build your investment case study!

The 8 main components of an investment case study

The main components of an investment case study include:

What kind of investments are you buying? Stocks, bonds, mutual funds, real estate?
How much money are you investing?
How often are you making these investments?
Why are you choosing this vendor or broker?
What do they offer that is special or unique compared to other companies in the same market?
How much money are you investing in each investment type, and how often are you investing it?
What kind of return do you expect? Is this realistic?
Who is your target audience/market/audience demographic, and what makes the company or product unique to them?

ESG stands for environmental, social, and governance. These criteria deal with a company’s impact on the environment, its treatment of customers and employees, and how it performs as a business. It is important to invest in companies that care about these factors because they may be more profitable than other companies that do not.

ESG investing is a more sustainable and profitable way of investing. ESG Investing leads to lower client-specified risk and higher client-specified return. The money that an investor has invested into an ESG strategy will be more diversified than the average portfolio of investments, which allows for better performance.

An ESG investment case study is different because it needs to include a method for achieving environmental and social impact alongside an analysis of the returns on investment. This includes both financial and non-financial risk. Understanding how a company has achieved its goals is key to understanding the investment’s worthiness.

Why does this matter? Because your investments should be sustainable. This means you need to support companies that are making investments on behalf of the future, rather than just focusing on profit in the present.

To achieve ESG investment, it is important to review reports or case studies that are written by third parties. This makes the process more transparent and will guarantee that you are investing in companies that have gone through a vetting process designed to reduce risk. These third-party organizations are engaged with an entire industry of investors who all want to invest in sustainable companies , so they are all on the same page.

Making this decision is important because it will ensure that you are not only investing your money but investing your values as well. It does not matter whether you are rich or poor; everyone has the capacity to make a difference through their investments by ensuring they are invested responsibly.

A good way to determine the return on investment for ESG is through a ratio analysis and determining an appropriate discount rate. You can also compare it against other alternatives, such as investing in a firm without considering their impact on the environment. There are several methods available.

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A discount rate is the interest rate that a company uses to account for the time value of money. The higher the discount rate, the more you’ll prefer a project with a sure payoff over one with an uncertain return. When evaluating projects, you need to choose an appropriate discount rate.

Ratio analysis helps by evaluating the return on investment through ratios such as return on assets and earnings per share. This may help you determine which projects will yield the most valuable returns.

Why it's important to invest in ESG considerations alongside other investments

ESG criteria are not just about doing good, they’re also about monetary value. If you invest only in companies that do well for the environment, then your portfolio will decrease in value. You need to diversify your portfolio by investing in companies that care both about the environment and profits. By investing in a variety of companies, you can reduce risk. If one company fails, then the others will pick up the slack and your portfolio won’t be affected as much.

Why it's important to have a diverse portfolio

A diverse portfolio reduces risk because if one asset performs poorly, then another may perform better. You will experience less volatility. If one asset performs well, then you won’t experience as large of a boost because the other assets may not have performed so well.

There are several ways to reduce risk when it comes to investing in a diverse portfolio. One way is to take advantage of certain types of investments, such as bonds. Another way is to compare the risk to your current portfolio and determine if there are any new investments that have similar levels of risk. Finally, you can also reduce risk by using a variety of different valuation metrics. This will allow you to see which companies are performing well independently while providing insight into why they’re doing well.

Valuation metrics allow you to determine which companies are profitable and why they’re profitable. You can then use this information for the future. For example, if you learn that Company X is undervalued, then you may consider investing in it because of its profitability. Other examples of valuation metrics include discounted cash flow and free cash flow.

A discounted cash flow takes into account the time value of money by applying a discount rate to future projected earnings, sales, and so on. This helps you figure out what the actual value of a company is. You can compare this to its current price to see if it’s overvalued or undervalued by using other metrics, such as free cash flow.

A free cash flow is the amount of cash a company has available after it pays for capital expenditures and any other cash expenses. It’s used in valuation metrics because it adds to (or subtracts from) the value of your company by showing how much money you can invest in future projects.

You can choose to invest in companies that are socially responsible. These may have better returns than companies that are not, all else being equal. You can also choose to invest in companies that are environmentally friendly. If you do this, then you will be investing in the future because the environment is something we need to care about if we want our planet to continue existing.

There are many different things you can consider when choosing investments. Remember to look at the costs of fees, commissions, and transaction costs before making any decisions because they may affect your ROI. Also, make sure to invest in companies that you know will maintain or increase their value. You also want to avoid companies that are significantly over- or undervalued because the price may not be stable.

Private equity is when an investor buys a company that is not public. The investor then takes on the responsibility of making decisions about how the company will operate in the future.

There are three main categories to look at when it comes to private equity: Leveraged Buyouts, Venture Capital, and Growth Equity. Leveraged buyouts take place when investors purchase a controlling stake in a company by borrowing money for the purchase. Venture Capital deals with investing in new innovative companies. Growth Equity deals with investing in existing companies that are looking to expand their business into other sectors.

Leveraged buyouts involve purchasing shares of stock using borrowed money for the transaction. This means that if the company doesn’t make enough to pay back the money borrowed, then you risk losing your investment. Venture Capital deals with investing in new innovative companies that may or may not be successful. Growth Equity deals with investing in existing companies that are looking to expand their business into other sectors.

Private equity investments are not liquid. This means that you cannot obtain the money at any time, and it can take months or years to sell your shares after purchasing them. This is because private equity deals happen between institutions, so they may have long negotiations before making a purchase. You should aim to obtain returns of 10-30% per year when investing in private equity.

When it comes to private equity, there are many factors that need to be considered before investing your money. These include the expected return on investment, how much control over the company you will have, and the reputation of the firm or person that is offering these investments.

A real estate case study is an analysis of the fair value of a property and how it has performed in the past. It also includes consideration for any changes that might happen to the market, such as interest rates or prices for similar properties. This kind of case study is important because it helps determine how much a property is worth and if you can expect to see a high return on your investment.

Real estate case studies take into consideration many different factors, including the cost of maintenance, expenses over time, the amount of rent the property can get, the market value of comparable properties, and how to account for depreciation. You want to make sure that you are getting a good deal when investing in real estate because real estate is not liquid, meaning it could take months or even years to sell your property after purchasing it.

Real estate investments are long-term investments because it can take months or years to sell a property if you need to cash out. This means that any money made from the investment needs to be reinvested into another property that will hopefully increase in value. You can expect returns of 7-13% annually when investing in real estate.

The first step is to compile all of the company’s financial data. The second step is to analyze that data, looking for trends that might be cause for concern or signs of opportunity. Brainstorm likely causes and possible solutions to those problems, then rank them by their potential benefit. Finally, create a plan detailing how you would implement your strategy if the client agreed with it.

Problem-solving case studies are created as a way to solve problems. A case study can guide you through the steps required for problem-solving and may include information on the situation, the goal, and potential solutions. Case studies will often involve asking questions about a situation and then looking at alternative approaches for problem-solving.

In conclusion, formulate a clear thesis about how it is important to be conservative when investing, and why you shouldn’t put all your eggs in one basket. Also explain the importance of having a diverse portfolio, which means splitting your money between stocks, bonds, etc., as well as reducing risk by buying shares from companies that are stable with good reputations. Remember that a case study isn’t a “problem” to be solved, but rather a story from which you can learn.

We have covered many topics in this article and want to be clear that any reference to, or mention of integration framework, financial services, brief introduction, investment decisions, examples, feel free, support, management, integration, create, framework, data, community, example, implementation, services, success, enable, access, process, project, research, solutions, partnership, integrate, systems, knowledge, resources, report, industry, customers, institutions, service, development, communication, course, reports, investors, world, health, frameworks, develop, involved, operations, profit, debt, identity, processes, creation, risks, the component in the context of this article is purely for informational purposes and not to be misconstrued with investment advice or personal opinion. Thank you for reading, We hope that you found this article useful in your quest to understand ESG.

Read on, read on…

The Comprehensive Guide to Equity Research

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Dean Emerick is a curator on sustainability issues with ESG The Report, an online resource for SMEs and Investment professionals focusing on ESG principles. Their primary goal is to help middle-market companies automate Impact Reporting with ESG Software. Leveraging the power of AI, machine learning, and AWS to transition to a sustainable business model. Serving clients in the United States, Canada, UK, Europe, and the global community. If you want to get started, don’t forget to Get the Checklist! ✅

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The registered investment advisor knew they needed to understand their customers’ purchase patterns, financial acumen and company interaction pain points to ensure the new digital self-service investment platform would be useful. So, they tapped into the experience of the EY Design Studio , a cross-functional design team comprised of strategists, writers, developers, product owners, researchers and UX/UI digital designers who create digital experiences backed by research in human behavior.

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The EY Design Studio team immediately began working with the investment advisor to analyze existing customer experiences, define a vision for the company's digital transformation and then apply the latest innovations in design to iterate toward that future state.

It is important to note that before the EY Design Studio began transforming the client’s online customer journey, the EY Microsoft alliance successfully migrated the investment advisor’s current customer relationship management (CRM) database onto the Microsoft Dynamics 365 platform. This step was crucial in creating a central repository for data collection and allowed the EY Design Studio to have access to important information for key design decisions.

The EY Design Studio team combined a data- and research-informed iterative approach with human-centered methodologies to design the client’s digital user experiences, creating more efficient, multi-channel interactions across all user types and touchpoints — from self-directed investors to advised investors, from the web to chat. Additionally, using an agile process, allowed the team to create a seamless on-time project flow.

Chart description

Five rotating images that visually represent, and further describe, each step the EY Design Studio took to help the registered investment advisor create the new digital self-service investment platform. The steps include: identifying pain points, designing journey maps, evaluating copy and building a chatbot.

“Our role at the EY Design Studio is to use empathy to drive design decisions making technology enjoyable to use,” noted Greg Picarelli, Principal, EY Design Studio, Ernst & Young LLP; EY US Experience and Innovation Design Commercial and Operations Leader. “In the case of this client, we used targeted user-centered research insights, modern design and advanced development methodologies to craft a unique digital experience allowing consumers to have more autonomy during the investment process.”

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With the goal to be seen as a digital leader in the asset management space, this investment advisor continues to elevate its brand and make it easier for customers to invest with them. Their next steps will include additional online investing capabilities and an upgraded mobile application making on-the-go investing even easier.

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PE Investment Memo Examples?

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Fellow monkeys: Does anyone have an example of a PE investment memo that they can share? Ideally, I'd like to see one from a prior case study when you guys went through buy side recruiting.

If nothing else, can someone give me an outline of some of the most relevant topics that I should hit upon when I (hopefully) go through recruiting? Appreciate any help, thanks.

Private Equity Investment Memo's

Here's the basic structure of a private equity investment memo as laid out by a certified private equity user. attached is an investment memo from blue point capital group.

from certified user @Minnow4"

Business and Transaction overview Financial Performance/Customer Data Industry Overview/Competitors Management Team Strategic Plan/Thesis Exit strategy Summary of Returns

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United Church Homes: Middle Market Case Study

This NIC case study features United Church Homes and details how their organization has committed to developing and operating middle market housing options for older adults in multiple Ohio markets.

December 18, 2023

Middle Market • Senior Housing • Case Study

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United Church Homes Middle Market Portfolio on Average Offers Rates Starting at 53% of Metro Market Independent Living Rates

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SDG Engagement Equity Q2 2024 case study

Eagle materials, fast reading.

Cement manufacturing is unavoidably carbon intensive. The transformation of calcium carbonate in limestone into calcium oxide is a vital step to produce clinker – a key component in cement – which is responsible for about 60% of total cement-manufacturing emissions.
According to industry associations, three principal drivers are needed to support cement decarbonisation: increased use of alternative fuels; reducing clinker content; and carbon capture, utilisation and storage technology (CCUS).
Eagle Materials has taken a number of positive steps, but a marked improvement is still required – in terms of its own production and across the industry at large – if this essential commodity is to support rather than hinder national and global efforts to achieve net-zero emissions.

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Optimal reinsurance and derivative-based investment decisions for insurers with mean-variance preference.

1. Introduction

2. model setup, 2.1. surplus process, 2.2. financial market, 2.3. wealth process, 3. problem formation and verification theorem, 4. solutions, 5. special case of no derivatives trading, 6. numerical studies, 6.1. how the parameters affect the equilibrium reinsurance strategies, 6.2. how the parameters affect the equilibrium investment strategies, 6.3. how the parameters affect equilibrium efficient frontier, 7. conclusions, author contributions, data availability statement, conflicts of interest.

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Zhou, H.; Zhu, H. Optimal Reinsurance and Derivative-Based Investment Decisions for Insurers with Mean-Variance Preference. Mathematics 2024 , 12 , 2047. https://doi.org/10.3390/math12132047

Zhou H, Zhu H. Optimal Reinsurance and Derivative-Based Investment Decisions for Insurers with Mean-Variance Preference. Mathematics . 2024; 12(13):2047. https://doi.org/10.3390/math12132047

Zhou, Haiying, and Huainian Zhu. 2024. "Optimal Reinsurance and Derivative-Based Investment Decisions for Insurers with Mean-Variance Preference" Mathematics 12, no. 13: 2047. https://doi.org/10.3390/math12132047

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investment_case_for_air_pollution_reduction_in_ethiopia_-_exec_summary.pdf pdf (1.8 MB)

Executive Summary - Investment case for air pollution reduction in Ethiopia

investment_case_for_air_pollution_reduction_in_ethiopia_-_exec_summary.pdf

June 26, 2024

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Two major sources of air pollution: ambient air pollution (AAP), also referred to as outdoor air pollution, and household air pollution (HAP) referred to as indoor air pollution are of major concern in Ethiopia. The analysis includes the impact of AAP on the six following diseases: acute lower respiratory infection, chronic obstructive pulmonary disease, ischemic heart disease, lung cancer ...

+141	Giving people a heads up that 2026 buyside recruiting has officially kicked off. Firms we know are going include:   [Updated as of 6 ET]: Carlyle KKR Sycamore CD&R Bain Cap New Mountain Cap Advent Berkshire H&F GA Apollo Berkshire Heard rumo… ">2026 Buyside Recruiting Kicked Off 6/24/24	214	9h
+136	On cycle kicking off in June... Like fuck me yeah I should have studied sooner, I am probably like 60% there but June is insane. Stuff like this makes me wonder if I am cut out for this high finance BS pipeline. I am about to spend 2 years of my life in a sweatshop, and I wanted to enjoy my… ">Maybe PE isn't for me.	24	3d
+71	All the threads lately on the on-cycle recruiting MADNESS are really insane to me. It seems to be accepted that it is just the way it is, but I would love to understand how it got to this point / how it works and what the logic is. From what I understand, you recruit for a job you will start in … ">Explain on-cycle recruiting to a clueless Europoor	13	2d
+43	On-cycle kicked off Monday and it’s been an absolute shit show. Around 10-15 firms went and were not even recruiting with the purpose to fill up their entire class (except for maybe 1-2, but unlikely). Many firms stopped due to extreme lack of preparedness (wtf you expect in June) and lower … ">Status of PE Recruiting	8	3d
+40	Why don’t people just buy their own businesses with an SBA loan? You can escape being a W2 slave with a dick head boomer boss and gain much more equity upside when owning your own business. You can go on bizbuysell and purchase a business with close to $300k in SDE and finance 90% of the p… ">Why not just buy your own business with an SBA loan?	43	8h
+36	Well... with on-cycle 2026 being a complete shit show, a lot of firms sitting out, and a lot of people seemingly unprepared, traveling, or just not getting calls from headhunters, I thought I'd go ahead and start a thread for any updates and news sourrounding off-cycle. ">Off-Cycle 2026 Megathread	12	3d
+36	Hi,   I work in REPE. My team's in the process of sourcing debt for an acquisition, and I prepared the IM sent to lenders.   I was asked to fudge the actual KPIs and financials of our existing assets, i.e, rounding up occupancy rates and revenues leading to material increase… ">Asked to fudge numbers?	20	3d
+32	Signed a PE Offer last night. The obvious is known to me (you have a fucking job) but do you just go two years with no communication until the months leading up? Do they background screen before you sign? Do you attend firm events throughout the year? What’s it look like from receiving the offer ti… ">What happens after signing PE Offer	13	4d
+27	Goldcoast has been probably the worst HH I have worked with. Constantly rude and snaky, and will continuously ghost. I’m at an EB and it’s night and day the way they treat us non targets vs the HSW kids. This past on cycle most of the people who got invites even in the top groups were from heavy pe… ">Goldcoast sucks	11	3h
+26	What's the point of PE firms paying headhunters this much money only to have such a shitshow every year for both candidates and the funds themselves? Everyone I know is just getting traumatized this year for very little spots actually being filled. In previous years you could say the headhunters di… ">A New Model for PE Associate Recruiting is Sorely Needed	6	3d

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Investment Case Study: Learning From Examples

What Is an Investment Case Study ?

Investment Case Study Archetype 1: A Poorly Operating Giant

Penn Central

Investment Case Study Archetype 2: An Empire-Builder that Falters

Ling-Temco-Vought

Archetype 3: A Tiny Company Swallows a Giant

NVF and Sharon Steel

Archetype 4: An Illusory Company Riding a Speculative Wave

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