LMM PE Case Study

Based on the most helpful WSO content, for a 3-hour case study with a Lower Middle Market (LMM) Private Equity firm, your initial thought is on the right track. Here's how you might want to prepare:

1. LBO Model Proficiency: Ensure you're comfortable with the mechanics of building a basic LBO model. Speed is important, but accuracy and the ability to explain your assumptions are crucial.

2. Investment Thesis Development: Practice articulating a clear and concise investment thesis. This is key as LMM firms often look for candidates who can not only crunch numbers but also understand and communicate the strategic value of a deal.

3. CIM Analysis: Be prepared to analyze a Confidential Information Memorandum (CIM) quickly and identify key investment considerations such as growth drivers, risks, and industry dynamics.

4. Add-Ons and Recapitalizations: While less likely to be the focus of a short case study, having an understanding of these concepts can be beneficial. It demonstrates a deeper level of knowledge that could set you apart.

5. Cultural Fit and Deal Rationale: LMM firms often value cultural fit and the ability to think like an investor. Be ready to discuss why you're interested in LMM and how you would approach deals in this space.

6. Practice Under Time Constraints: Simulate the case study environment by practicing under timed conditions to improve efficiency.

Remember, the goal of the case study is not just to test technical skills but also to gauge how you think about investments and how you would fit within the firm's culture. Good luck with your preparation!

Sources: How to Prep Before Starting PE Gig, How to approach LMM PE recruiting?, Q&A: MBB to MM PE, Q&A: 3rd Year PE Associate ($10bn+ AUM, MBO/LBO, equity, mezz, distressed debt), 3 Things to keep in mind for case interview prep: Fall Interview Season is around the corner

Based on the most helpful WSO content, for a 3-hour case study with a Lower Middle Market (LMM) Private Equity firm, your initial thought is on the right track. Here's how you might want to prepare:

1. LBO Model and Investment Recommendation:

   • LBO Model: Be prepared to build a basic LBO model. This is a fundamental skill for PE interviews and case studies. Ensure you can create a simple LBO model quickly and accurately.
   • Investment Recommendation: Be ready to articulate a clear investment thesis. This should include the rationale for the investment, the value creation plan, and an exit strategy.

2. Speed and Efficiency:

   • Speed: Given the time constraint, practice to increase your speed without sacrificing accuracy. Being able to complete tasks quickly is crucial.
   • Familiarity with CIM: Review how to extract key information from a Confidential Information Memorandum (CIM) efficiently.

3. Investment Thesis Practice:

   • Developing a View: Practice forming and articulating investment theses based on different scenarios. This is a critical skill in PE to assess potential investments.
   • Presentation Skills: Be able to present your findings succinctly. This includes summarizing the investment opportunity, risks, and mitigants.

4. Complex LBO Structures:

   • Advanced LBO Concepts: While less likely to be the focus of a 3-hour case, understanding more complex LBO structures can be beneficial. This includes add-ons or recapitalizations.
   • Scenario Analysis: Be comfortable with running different scenarios within your LBO model to show how various factors could impact the investment outcome.

5. Focus Areas:

   • Core Skills: Ensure your core financial modeling skills are sharp, including working capital, capex, and debt schedules.
   • Key Assumptions: Practice setting and justifying key assumptions in your model, as these can significantly impact the investment outcome.

Remember, the goal is to demonstrate your ability to think like an investor and show proficiency in LBO modeling. It's also important to communicate your findings clearly and effectively. Good luck with your case study!

Sources: Q&A - 1st Year PE Associate at a US MF in Europe (KKR, BX, TCG, WP, TPG, BC, APO), Q&A: 3rd Year PE Associate ($10bn+ AUM, MBO/LBO, equity, mezz, distressed debt), [Experience] Road to PE - Investment Analyst in a MegaFund, How to prepare for after IB analyst program, PE case study mistakes