Private Equity Case Interview Jun 2026

| Risk | Impact | Mitigation | |------|--------|-------------| | Slower add-on integration | Revenue synergies delayed | Hire integration VP pre-close; use holdco cash for earnouts | | Customer concentration | Loss of one large client | Contractual minimums; cross-sell to reduce churn impact | | Multiple contraction at exit | 1x lower multiple | Improve EBITDA margin to 33% to justify 9.5x+; secondary exit to strategics |

"I have $360M exit. I pay off the remaining debt—let’s say $60M is left. That leaves $300M to equity. I put in $40M. I get out $300M. That’s a 7.5x Multiple on Invested Capital (MOIC)."

Sterling slid a single sheet of paper across the table. private equity case interview

Sterling stood up. He buttoned his suit jacket. He didn't offer a handshake—PE partners rarely did in interviews—but he gestured to the door.

"Buy low, sell high," Elias said simply. "But mostly, fix the machine." I put in $40M

| Year | Revenue | EBITDA | EBITDA Margin | Net Debt | Cash Flow Pre-Financing | |------|---------|--------|---------------|----------|-------------------------| | Y0 | 50.0 | 12.5 | 25.0% | 68.8 | – | | Y1 | 53.5 | 13.9 | 26.0% | 62.5 | 5.2 | | Y2 | 57.2 | 15.8 | 27.6% | 54.2 | 6.3 | | Y3 | 61.2 | 18.1 | 29.6% | 43.7 | 7.8 | | Y4 | 65.5 | 20.6 | 31.5% | 30.5 | 9.2 | | Y5 | 70.1 | 23.5 | 33.5% | 14.0 | 11.0 |

Elias took a breath. "Okay. $200M revenue, $30M EBITDA. That’s a 15% margin. Healthy for manufacturing, but I’m guessing there’s a catch." Sterling stood up

"Standard structure," Elias said. "3x leverage. I borrow $90M. Equity check is $40M."