Trending Content - Private Equity Forum
| +89 | Nothing to do at work & bored to hell | 10 | 6h |
| +67 | Do people over-index on 'moats' | 22 | 2d |
| +54 | Predicted Net Worth in Trodden Finance Path by 60? | 20 | 2d |
| +44 | Biggest (avoidable) failures in PE Investments? | 25 | 2d |
| +25 | What do you think of PE Value Creation Careers in 2026? | 7 | 1d |
| +19 | LT Career Path after MF PE Associate Program? | 6 | 1h |
| +17 | Is the lifestyle really better? | 15 | 4h |
| +12 | Reference checks after final round | 2 | 3h |
| +12 | NY LMM PE Recruiting | 3 | 3d |
| +12 | Those who left PE for Corporate, why? | 6 | 3h |
Career Resources
Hey neil91, the following topics might be helpful:
Fingers crossed that one of those helps you.
Modifying GP assumptions. Sometimes if we feel a certain part isn't detailed enough we would break the model and insert our own assumptions. For example, if management only takes into account growth capex, we would make an assessment of maintenance capex and factor that into the model.
The bulk of the analysis focuses on stress testing the assumptions. How silly can your assumptions be that still gets you to your desired returns. For example, if the company has been well over industry growth rates. If you just assumed it grew at market rates and be able to get to your returns, then it is an easy sell at the IC. I had one case where because of the structuring and low entry multiples, we could assume the company growth declines and we could hit our targeted returns, another very easy sell.
Yeah, my team usually takes the base GP model and then we’ll diligence all the inputs and assumptions and tweak them as needed. Lots of building in different cases - GP case vs our baseline, upside, and downside cases.
You’re absolutely right we will break the model and insert our own more complex builds for things as needed. Always layer on LP returns on top of course.
Thanks guys. How do you then monitor your co-invest positions? Do you get quarterly reports from the portfolio companies? Also, if a platform company makes an add-on acquisition, will you then update your model?
At my fund we get quarterly reports from the GP.
And yes, if there is an add-on acquisition, we will get a revised financial model from the GP and re-perform our analysis. But our analysis certainly wouldn't be as detailed as when we first invested in the company.
Velit molestiae earum cum mollitia. Consequatur nesciunt necessitatibus a dolores officia. Debitis tempore numquam laborum deserunt voluptatum impedit omnis. Id deserunt aut occaecati fuga corrupti vel alias.
Dolore officiis sed blanditiis in ut saepe eaque iusto. Et dolorem aut qui in. Quae voluptatem aliquam maxime. Eos enim perferendis error ad dolores.
Aliquid architecto consequatur et et accusamus. Tempore nam amet maxime qui incidunt. Repellendus quo ab error id. Suscipit molestiae magnam est ea vel sit.
Id nesciunt quibusdam enim consectetur eos distinctio. Quia qui voluptates odio ut. Molestiae reprehenderit et quidem ullam. Voluptatem praesentium similique est libero. Quisquam asperiores suscipit voluptas ut. Voluptatem occaecati fugit esse tempora ipsa enim quis.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...