Walk Me Through An LBO - Investment Banking Interview Question

In this video, we walk through the question, 'Walk Me Through an LBO', which is one of the most common LBO-related questions for Investment Banking and Private Equity interviews. The trick with answering this question is having an organized, succinct answer which we provide for you in the video. We provide a simple, 6-step framework to help you master this question and land the job.

Learn how to answer interview questions from a former Investment Banking (UBS LA), Private Equity (Golden Gate Capital + HIG Capital) and Investment Management ($200B Mutual Fund / $2B Hedge Fund) practitioner…and Adjunct Professor in Columbia Business School's Value Investing Program who has trained thousands of current IB/PE/HF/MF professionals.

Hope you find it helpful!

Contents:

00:00 - Intro
00:08 - Video Context & Overview
00:30 - How to Answer This Question / Six Step
00:56 - Walk Me Through an LBO Step 1: The Purchase
01:37 - Walk Me Through an LBO Step 2: Debt & Equity Financing
02:08 - Walk Me Through an LBO Step 3: Collecting Cash Flow to Pay Down Debt
02:36 - Walk Me Through an LBO Step 4: Selling the Business
03:10 - Walk Me Through an LBO Step 5: Calculating Sale Proceeds
03:52 - Walk Me Through an LBO Step 6: Calculating Your Return
04:23 - Recap / How to Answer The Question
05:17 - Wrap-Up

Hope this is helpful and let us know if you have any questions in the comment section below.

#InvestmentBanking #LBO #LeverageBuyout #PrivateEquity #HedgeFunds #FinanceInterviews #Valuation #EBITDA #Multiple

[RichDM]

Mike, this is the best explanation of an LBO I’ve ever seen. Thank you!

[timothybracken]

you're the only one that makes it so clear, thank you so much !!

[youssef]

You are a god send with explaining this stuff! Thank you man!

[CraigGoodson-uk]

These videos are incredible! Makes it very easy to understand.

[samuelsaldarriaga]

Thank you so much! This made it all so clear!

[DrArtorias]

Really clear explanation and very helpful

[poojanair]

wow! That was so precise and clear! Thank you.

[livhyeju]

Very helpful video! I learned so much 😊

[rachitbharti]

Need a more detailed explanation just like the DCF video.

[FinanceableTraining]

Very excited to launch our latest video which covers one of the most common LBO-related questions for Investment Banking and Private Equity interviews. Let us know if you have any questions!

[ClassyMarianO]

Can you please tell me how you calculated the annualized rate of return?

[none]

Unironically how can do get your polo?

[anthonytadros]

Im confused with ine thing. The 100 dollars left after devtors is paid doesnt all go to the owner right? The firms or individuals that purchased equity and essentially fascilitated the $50 equity financing would recieve their share if the return, correct? So owner would recieve their share of profit. Or by owner are yiu reffering to all owners, i.e all those with equity in the business

[Economics_enthusiast]

How much more in depth would you have to go during an interview?

[hkgyguhuviChbjn]

Robinson Patricia Young Jessica Taylor Deborah

[DanaHenderson-le]

Thomas Matthew Thomas Shirley Allen Lisa

[tudorforbes]

Great video and well explained thank you! What happens to the remaining $30 of debt when you sell? Will it just stay as debt in the firm when selling or must it be repaid prior?

[EdmundKirk-cj]

Lewis Brian Harris Sharon Martinez Maria

[FudgeBondu]

Robinson Brian Clark Angela Hall Linda