In process with a venture bank and received a case study in which I need to analyze whether a company should be given a debt facility and if so, how to structure it. Given monthly financials going back 1.5 yrs plus some industry info. I'm familiar with equity models but not sure how to tackle this one. Anyone have a model for this type of situation, whether it be commercial banking, private credit, or venture debt, or any tips on how to approach it?
Thanks!!
Clawback, bummer your thread hasn't had a response yet. Sometimes bots are smarter than humans anyways:
No promises, but sometimes if we mention a user, they will share their wisdom: Justin-Dobson courtneyland redbullwings
Fingers crossed that one of those helps you.
I’m interested in this too. Anyone have any idea what the lending decisions get made based on, too? I imagine that you generally can’t use FCF as a credit metric.
So I’m assuming you’re responsible for analyzing the credit profile of the company and whether or not it’d be a good debt investment. From a credit point of view pay close attention to free cash flow generation, capex, FCCR. You’re going to first want to assess a leverage read and then you can think about a traditional senior/mezz structure or a unitranche structure based on the needs of the company. Probably throw in an RLOC as well.
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