I wanted to put together a learning plan which tracks useful links / resources to read ahead of starting my PE stint in a couple months.
Appreciate if the community can provide ideas to improve this list. Hopefully this can also help people be more prepared as they embark on their career in IB / PE.
I would categorise these into a couple of knowledge areas:
- Financial and Accounting Concepts
- Financial Modelling
- Financial Analysis
- Process / Execution Knowledge
- Industry Knowledge
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Financial and Accounting Concepts
- Thorough understanding of financial and accounting concepts are basic hygiene factors that analysts and associates are expected to be equipped with
- However, these may oftentimes be neglected / forgotten along the way as we spend 16 hours a day aligning logos
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Read, read and read to refresh memory on various terms and concepts. Below are a few resources with useful Finance and Accounting 101 materials:
- Corporate Finance Institute (CFI) provides a useful glossary of financial and accounting terms:
- Macabacus is a treasure trove of information:
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Wall Street Prep also has a couple of useful resources:
- This one on debt is useful: https://www.wallstreetprep.com/knowledge/ultimate-guide-to-debt-leveraged-finance/
- Breaking into Wall Street has video tutorials for those who prefer to watch and learn: https://breakingintowallstreet.com/biws/kb/
-
Financial Modelling
- LBO models are the bread-and-butter of any PE analyst / associate
- However, before diving into building an LBO model, it is important to master the art of building and structuring an operating model
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Build a standalone model from scratch. Practice makes perfect
- Modelling best practices:
- Step-by-step guide to building an operating model:
- Once comfortable with building a fully linked 3-statement model, it's time to learn the sexy stuff
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Financial Analysis
- This is where you put together your knowledge in financial & accounting and modelling prowess
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Below are some analysis and useful resources:
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Types of financial analysis:
- http://sellsidehandbook.com/2018/09/23/analyzing-financial-statements-and-ratios/
- https://corporatefinanceinstitute.com/resources/knowledge/finance/types-of-financial-analysis/
- https://corporatefinanceinstitute.com/resources/knowledge/finance/analysis-of-financial-statements/
- https://corporatefinanceinstitute.com/resources/knowledge/finance/financial-ratios/
- IRR & MoM:
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Other analysis
- EVA: https://corporatefinanceinstitute.com/resources/knowledge/valuation/economic-value-added-eva/
- ROE: https://corporatefinanceinstitute.com/resources/knowledge/finance/what-is-return-on-equity-roe/
- ROA: https://corporatefinanceinstitute.com/resources/knowledge/finance/return-on-assets-roa-formula/
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Types of financial analysis:
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Process / Execution Knowledge
- Execution work takes up most of our time as a junior deal team member. Apart from being a numbers monkey, we are expected to lead parts of the investment / transaction process
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Understanding deal mechanics and how to run a process / due diligence would make you a more valuable monkey
- Private equity investment process: https://www.streetofwalls.com/finance-training-courses/private-equity-training/private-equity-investment-process/
- M&A sale process:https://macabacus.com/mechanics/sale-processes
- Deal structures:https://macabacus.com/restructuring/spin-offshttps://macabacus.com/strategies/overview
- SPA negotiations:https://macabacus.com/mechanics/agreements
- Private vs public transactions:https://macabacus.com/mechanics/private-vs-public
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Industry Knowledge
- For those joining a sector-focused team, getting up to speed with the industry would make you appear more intelligent and save you time when evaluating an opportunity / working on a transaction
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As I will be joining a consumer-focused fund, I will start by collating knowledge pieces on the Consumer / Retail sectors
- Sell-side handbook on Consumer & Retail: http://sellsidehandbook.com/industries/consumer-products-retail/
- Basic overview of the consumer sector: https://www.wallstreetoasis.com/forums/basic-overview-of-the-consumer-sector
- What you do in the Consumer Retail Group at an Investment Bank: https://www.mergersandinquisitions.com/consumer-retail-investment-banking/
- S&P Primer on Consumer Discretionary: https://www.spglobal.com/spdji/en/documents/education/education-sector-primer-series-consumer-discretionary.pdf
- S&P Primer on Consumer Staples: https://www.spglobal.com/spdji/en/documents/education/education-sector-primer-series-consumer-staples.pdf
Appreciate any contribution / feedback. Will continue to update and refine this post to keep track of useful resources. Thanks!
You're amazing
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Thank you :)
Great resource. This should be pinned
Huge, thanx
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Might be the best post I’ve seen
Wish I could SB you twice. Excellent contribution!
Awesome post, great collection of resources. One thing that I’d hope for more color on is the sector/industry piece. I find the S&P primers to have only a paragraph or two of valuable information, and a number of industry primers that one can find online are either outdated, extremely specific to some niche, or too broad. Anyone have any good resources?
Thank you. Would love to know if there are more useful resources out there on industry too.
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Phenomenal post. Thank you for compiling this.
Thank you so much for this
beast.
Awesome resource. Thanks for this!
One of the best posts in the history of WSO
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Amazing! Thank you
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Bro, thanks for putting this together, however if you’re already in IB working past midnight everyday, I really do hope you’re not spending your limited free time reading corporate finance guides
I'm currently taking a break before starting my PE stint, so taking some time to refresh my CF knowledge.
May be surprising, but some really basic concepts may be lost after not utilising them for a while.
Awesome!
.
If you had to reco one book to keep on your desk for financial "concepts" (bucket 1) what would it be ?
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