Joining a PE firm in the coming months and in the midst of some model prep I was curious... How long would you would expect / allocate for a new associate to build a fully functioning 3-statement operating model (revenue drivers, D&A schedule, PP&E schedule, financing, transaction etc.). A week or two of full focus?
*Assuming a background in investment banking i.e. have built models before
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Anywhere from a weekend to a couple of weeks depending on process and how much you're doing from scratch. A lot of times you'll get a model from the sellside and use their form without necessarily rebuilding from scratch if the revenue build is right. And then with costs (oversimplified) you'll just get the QoE guys to tell you what is bullshit and what isn't. But it could be a total pain in the ass where you're doing something like building a software contract waterfall from scratch which will take a ton of time. So long story short it depends but generally it's not that tough, the tough part is responding to the million bullshit sensitivity requests which sure are important to help your MD think about the business in various scenarios, but are still frustrating to have to do over and over at 3am.
Just like starting FT in banking, you won't be thrown in with zero guidance and expected to know everything day 1 of your new job. Model prep is a good start, but your colleagues will still expect to train you on certain things especially those not frequently seen in banking. Keep up the prep but most people are only doing their banking modeling and no other practice outside of interview prep.
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