By Matan Feldman, CEO, Wall Street prep, Inc.
Wall Street Prep's LBO Self Study Program
As many of you know, we conduct LBO Modeling boot camps across the globe. We get into relatively sophisticated modeling techniques and teach practitioners how to model out various scenarios. But as former analysts and associates ourselves, we still remember the information-overload way we were taught LBO modeling, so it’s always been apparent to us that amidst all that granularity, practitioners can lose the forest for the trees.
That’s why we always start our LBO classes and LBO self study program with an “LBO on a cocktail napkin” exercise. I’d like to share this exercise with you today. It’s an easy way to wrap your head around the basics of an LBO. In fact, many of the challenges facing the private equity world are illuminated when all the granularities are monetarily set aside.
Many of us do an LBO in our own lives without even realizing it when we buy a house. Let’s say you are thinking about buying a house for $500,000 (80,000 down payment, $420,000 mortgage) that will serve you as an investment property. Continue reading →
