Hey guys - I appreciate that there are a few posts on this topic. They are all super helpful but focus primarily on what sort of questions to ask yourself when reviewing an IM etc. whereas I wanted to discuss more broadly about what practical steps one can take to prepare for the interview. It would be great if those who have been through MM PE recruiting could share their thoughts.
Below is the approach I am currently utilizing - let me know what you think:
- Gathered 4-5 old IMs from each of a variety of industries (consumer, healthcare, tech, industrials)
- Going through each one and preparing the following:
** LBO model (Management/IM case, base case and downside case applied to what I think is a suitable cap structure given the business and potential valuation)
** Investment Thesis (Strengths and Opportunities)
** Risks & Mitigants (Weaknesses and Threats)
** Areas for further due diligence
** Final investment recommendation (basically summarizing the two most important thesis points and risks and stating that the risks associated with achieving the thesis are either manageable or too great) - Educating myself on structuring (e.g. PIKs, SHLs, unitranche debt, different investment angles (e.g. do we think about doing a majority equity investment, minority equity investment or maybe even invest in a business' debt))
- Practising both orally and putting down 2 pages conveying the above findings
From doing a few practices so far, it seems that the Investment Thesis section is usually the easiest on the basis that the IM obviously spells out the thesis/portrays the business in a very positive light. The time I am trying to spend more time on is Risk & Mitigants as ultimately this determines whether or not you should recommend following through with trying to achieve the thesis or not.
Questions on the above approach:
__ Is there anything else I should be doing/thinking about if preparing for a case study interview at a generalist PE shop? Perhaps also reading up on different sectors?
__ Is it better to think about cases in terms of SWOT or Thesis/Risks/DD/Recommendation (although to me they are broadly the same thing...)?
Thanks a lot and hope this is helpful for others!
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