Hello WSO,
I have an interview for an entry level position for a growth equity firm. I would just like some input on what would make a growth equity investment. Could you please elaborate/add to some of my thoughts below.
As no debt is being used I believe stating things such as minimum CapEx and stable and predictable cash flow ( although I suppose you could frame it in terms of good growth projections for this) become less important.? Of course, things such as CapEx is important but as the capital would be used to finance rapid expansion how should I look at it?
Should my focus be on highlighting the following:
A good path to exit, so knowing whether M&A activity is more strategic or financial.
Good scalability, by this I mean are we able to replicate the existing model throughout the country or expand it into a new geography
High barriers to entry. Although the market may still be in its infancy you have already gained traction, therefore you need to maintain your strategic edge.
Increasing EBIT margins? I would really like some input in terms of some specific financial metrics you would place close attention to besides things such as revenue growth etc...
I would really like some input from professionals within PE and not those who are currently studying.
