Private Equity & Exit Opps
Full paper LBO: $100 EBITDA bought at 10.0x with 6.0x of debt at 10% interest. EBITDA grows $10/year for 5 years. Annual FCF = EBITDA − interest ($60 fixed, for simplicity) − $40 of capex, taxes, and working capital. Exit at 10.0x. Walk to MOIC and IRR.
Model answer
Entry: EV = 100 × 10 = $1,000; debt = $600; equity = $400. EBITDA path: 110, 120, 130, 140, 150. FCF each year = EBITDA − 60 − 40: yr1 = 10, yr2 = 20, yr3 = 30, yr4 = 40, yr5 = 50 → cumulative…
The full, human-reviewed answer is in the bank.
Sign up free and Daily 10 serves you 10 questions a day from all 2,300+ — or go Pro for unlimited reps.
Pro unlocks every model answer — $19.99/mo.
More from Private Equity & Exit Opps
- At a high level, how does private equity recruiting differ from investment banking recruiting?
- What's the difference between on-cycle and off-cycle PE recruiting?
- Should an IB analyst go on-cycle or wait for off-cycle? What are the real trade-offs?
- What role do headhunters actually play in PE recruiting, and why are they called gatekeepers?
- How should you prepare for and handle the headhunter intro call?
- What should you tell headhunters about your fund preferences — and why does consistency matter so much?
Try the real thing
1 / 3DCF & WACC
Why do you use unlevered free cash flow in a DCF and how do you calculate it?
Superday coming up? Take the cheat sheet.
The technicals and stories to have cold before you walk in — free, one email, no mailing list.
Free tier: 20 cards + 10 daily reps + ALL drills — no credit card required.