StreetCred guide
LBO Practice Case
A full-model LBO practice case with 107 scored checks: sources and uses, floating-rate debt schedule with cash sweep, integrated statements, and MOIC and IRR outputs.
107
Scored checks
10
Scored modules
45 min
Timed rep
The short answer
A useful LBO practice case goes beyond paper-LBO arithmetic: you build sources and uses, a floating-rate debt schedule with a cash sweep and minimum cash balance, fully linked statements, and formula-driven MOIC and IRR. StreetCred's LBO Case Study scores that build across 107 checks in 10 modules.
What this case makes you build
You get a model template, a case brief PDF, and a historical financials workbook. From those you build the transaction: sources and uses from the entry assumptions, an income statement that reflects the new capital structure, a working capital schedule, capex, and a debt schedule where interest floats over a SOFR-style base rate, the revolver accrues a commitment fee, and a cash sweep repays debt above a minimum cash balance.
The 10 scored modules run from the assumptions block through transaction overview, income statement build and summary, balance sheet, cash flow statement, working capital, debt schedule, and capex, ending in the returns analysis: exit equity value, MOIC, and IRR. There is even a dividend recap toggle — the kind of switch a real sponsor model carries and a paper LBO never teaches you to wire.
Why a full-model LBO instead of a paper LBO
Paper LBOs teach the arithmetic of returns; interviews at funds and in sponsor coverage increasingly test whether the machine itself works. The classic failure is a debt paydown formula that goes negative when free cash flow dips, silently amortising debt that no longer exists — a bug that only appears when the schedule is wired to a real cash flow statement.
That is why 100 of this case's 107 checks require live formulas. A returns page where MOIC is typed in gets flagged by the scorer the same way it would be by the associate reviewing your test file.
Where candidates lose points
- Confusing enterprise and equity value at entry or exit — the single most common returns error.
- Cash sweep logic that ignores the minimum cash balance or repays more than the outstanding tranche.
- Guessing the interest convention (opening versus average balances) instead of reading it from the case brief.
- Hardcoding MOIC or IRR instead of linking them through the exit equity build.
- Sign-convention drift: sources positive, uses negative, until suddenly they are not.
Frequently asked questions
What should I practise before an LBO modelling test?
In rough order of marks at stake: sources and uses, the debt schedule (drawdown, floating interest, commitment fees, cash sweep against minimum cash), exit equity value, and MOIC and IRR. In this case those areas carry most of the 107 checks, and the debt schedule is where builds most often break.
Is this a paper LBO?
No. It is a full workbook build with integrated statements, scored at 107 individual cells. Paper-LBO arithmetic is useful mental preparation, but this case tests the version interviews are moving toward: does your model actually run.
Practice the task, not just the topic.
Start with the free diagnostic, build the workbook yourself, and use the score report to decide your next rep.
Start free diagnostic