M&A Associate Interview super day fail postmortem

Will bite because i'm also prepping for interviews and am an associate (year 3).

Think you have some info from the case study that you did not share but will try my best. Might have missed some stuff as we don't have the case study and it's just a high level overview so other more experienced or knowledgeable monkeys please free feel to contribute

DD Questions: 

• If you're the sell side, not sure why you need to prepare DD questions? unless it's prepping management to answer them to which the firm usually has a bunch of boilerplate DD questions to give to let them prep to which i will add on specific items that are key to the target company/industry 
• Assuming it's prepping the company, it will also depend on how detailed investors want to get, which usually depends on the size of the business and the preference of the investors (usually EV of US$5bn is different from EV of US$50m)
• Will split questions between commercial/legal/tax/financial/HR/Insurance/IT
  • Commercial: methodology  behind how previous sites were chosen and their valuation, how new sites chosen, competitor and industry analysis, how did current sites do historically and how they are projected to do, how covid has impacted the business (think you got this covered), business drivers, new markets/services suggested to go into etc.  something to talk about will be how EVs will play into this and how car wash businesses can value add to customers, who are the customers
  • Financial: Working capital and payables analysis, financial statements and sustainable EBITDA, debt, related party transactions, equity structure (i.e. any preferreds or convertibles) , covid or management adjustments, debt like items etc. 
  • Legal: licensing ,litigation, material contracts, whether the company leases or owns the land it has its business on etc. 
  • Tax/HR/Insurance/IT: any normalisation costs or potential synergies , any thing out of the ordinary, severance/labor unions, synergies, new IT capex required, possible to bundle insurance for various entities to one insurance provider etc. 

EV/Valuation: 

• Guess there was info in the case study not shared with us but hope you gave more reasoning why 6 to 8x EBITDA was reasonable?
• I will refer to market/trading comps and how the current business stands and how it is projected to do based on margins and growth vs its peers. I have no view on the balance sheet nor the industry info provided so can't comment

Timing: 

• Usually this is led by the client and how their financials are, what type of transaction it is, and how motivated the shareholders are (i.e. are they a financial sponsor looking to exit because of fund life or is it a rich dude just fishing in the market and the company is throwing up cash) 

Others: 

• not exactly sure what "uncertainty" you mentioned on the balance sheet (is it high debt?) so cannot comment, but i will have compared the debt to peers and will comment that ultimately it seems that the carwash business is a battle of "capital allocation" between carwashing and other businesses in decent locations (i.e. petrol kiosks etc.). What makes a piece of land a good place to set up a car wash and not a petrol kiosk with car washing facilities or a fast food joint with a drive in? 
• Yes, i would think the car wash business will be a negative working capital business (i.e. customers pay up front, hence very little receivables and mostly payables because of your suppliers). perhaps this was the point they are looking for? i have been to PE interviews where we had a chat about what types of businesses are negative working capital. seems the way to juice out as much Free cash flow to firm will be to extend the period payables are settled (this is for financial sponsors) but don't think they will be the main buyers - will think a carwash business will be sold to a strategic or a sponsor with a strategic angle with a complementary business