Investment Banking interview preparation
Every question below is either traced to a named firm from a public candidate report, or tagged at desk level when we could not trace it. Answers are written the way you would actually say them out loud — answer first, then the mechanism, then the limitation.
100 questions, mapped to the firms that asked them
- Questions
- 100
- Traced to a firm
- 100
- Firms
- 46
- Updated
- September 2026
039Would an increase in price or an increase in volume be more preferable when you are trying to deliver synergies?LazardMergers and Acquisitions · New York · 2026
Say this
Price, almost always. A price increase drops straight to the bottom line with no incremental cost, while a volume increase carries variable cost, working capital and often capacity investment with it.
Then walk it
- A dollar of price is a dollar of gross profit. A dollar of volume is a dollar times the gross margin, so at a 40 percent margin you need two and a half times the revenue to get the same profit.
- Volume also consumes cash. More units means more inventory and receivables, and eventually more capacity, so free cash flow lags the revenue.
- Price is also faster. You can reprice a portfolio in a quarter; winning share takes years.
- The counterargument, and I would raise it: price synergies are much harder to defend to regulators, because raising prices post-merger is precisely what antitrust authorities are watching for. Volume and cost synergies are safer ground in a filing.
- Price is also fragile. It invites competitive response and it can accelerate customer churn, so the durability is lower even though the immediate flow-through is better.
Where candidates lose it
Answering only with the margin arithmetic. The regulatory dimension is what makes this an M&A question rather than a maths question, and at a firm like Lazard that is the half they are listening for.
Expect next
- How would you defend price synergies to a regulator?
- Which synergies do you actually put in the model?
- Why do most deals miss their synergy targets?
Reported by candidates at Lazard (Mergers and Acquisitions, New York, 2026). Source: Wall Street Oasis.
040Would Blackstone or Nike pay more to acquire Adidas, and why?NomuraInvestment Banking · New York · 2026
Say this
Nike, on economics. A strategic buyer can pay for synergies a sponsor cannot: overlapping supply chain, shared distribution and marketing scale. Blackstone only has financial engineering and whatever operational improvement it can drive alone.
Then walk it
- Nike's ceiling is intrinsic value plus synergies. Procurement, logistics, retail footprint and back office overlap are all real, so the synergy pool is large.
- Blackstone's ceiling is whatever price still clears its target return, typically a low-to-mid twenties IRR over five years. No synergies, so the value has to come from leverage, multiple expansion and operational improvement.
- So on paper the strategic wins, and that is the standard answer.
- But the deal would never happen for Nike. Combining the two largest athletic brands would be blocked on competition grounds in every major market. A buyer who cannot close cannot be the highest bidder in any real sense.
- So the honest answer is: Nike can pay more and will not be allowed to; Blackstone can actually transact. And a sponsor can sometimes win anyway on speed, certainty and no antitrust review, which is why sellers do not always take the highest nominal number.
Where candidates lose it
Giving the textbook 'strategics pay more' answer without noticing that this particular pairing is an antitrust impossibility. The firm names were chosen deliberately. Spotting that is the whole test.
Expect next
- Who typically pays more, a sponsor or a strategic?
- Who would be a realistic buyer then?
- When does a seller take the lower bid?
Reported by candidates at Nomura (Investment Banking, New York, 2026). Source: Wall Street Oasis.
042What is the difference between management rollover and management incentives?CitiMergers and Acquisitions · New York · 2026
Say this
Rollover is management reinvesting its existing equity into the new deal instead of cashing out. Incentives are new equity granted to management going forward, usually options or a management incentive plan that vests on performance.
Then walk it
- Rollover is backward-looking value. Management already owns shares; instead of taking the cash, they roll some percentage into the new capital structure alongside the sponsor.
- It reduces the sponsor's cheque size, which is helpful, and it signals confidence, which buyers care about. It can also be tax-deferred, so management has a reason to want it.
- Incentives are forward-looking and dilutive to the sponsor. A typical management incentive plan is five to fifteen percent of equity, vesting on time and on a return hurdle.
- In a model they sit in different places. Rollover is a source of funds in the sources and uses table. The incentive pool is dilution to the sponsor's exit proceeds, so it reduces the sponsor's IRR, not the entry price.
- The reason both exist: rollover aligns management on the downside because their own money is at risk, and the incentive plan aligns them on the upside. A sponsor wants both.
Where candidates lose it
Conflating the two, or putting the incentive pool in sources and uses. Rollover funds the deal; incentives dilute the exit. Getting that placement right is what the question is actually testing.
Expect next
- How does the incentive pool affect the sponsor's IRR?
- How much rollover would you expect management to do?
- Where does rollover sit in the sources and uses?
Reported by candidates at Citi (Mergers and Acquisitions, New York, 2026). Source: Wall Street Oasis.
045Based on the financials in front of you, would you advise this company to sell or not?Harris WilliamsInvestment Banking · Richmond · 2024Lincoln InternationalMergers and Acquisitions · New York · 2025
Say this
I would answer the question directly with a recommendation, then defend it on three axes: where the business is in its own trajectory, where the market is in its cycle, and what the owner actually wants.
Then walk it
- Sell into strength. If margins have just peaked, growth is decelerating, and the sector is trading at a cyclical high multiple, that is the moment. Buyers pay for the next three years, not the last three.
- Hold if there is a visible, fundable value-creation step the current owner can capture: a margin programme half done, a new facility about to come online, a contract about to be signed. Let the buyer pay for the result, not the plan.
- Then the owner's own position. A founder with all their net worth in one asset has a diversification reason to sell that has nothing to do with the multiple. A partial sale can solve that.
- Test the buyer universe before recommending a process. A thin buyer list means a weak auction and a weak price, whatever the financials say.
- Then commit. Something like: given decelerating growth, peak margins and a deep strategic buyer list, I would run a process now and target the strategics.
Where candidates lose it
Hedging. Middle-market bankers ask this to see whether you can make a recommendation on incomplete information. Saying 'it depends' and stopping is a fail. Pick a side, then name what would change your mind.
Expect next
- Who would be a dark horse buyer?
- Build me the buyer universe.
- What would change your recommendation?
Reported by candidates at Harris Williams (Investment Banking, Richmond, 2024); Lincoln International (Mergers and Acquisitions, New York, 2025). Source: Wall Street Oasis.
046Who would be a dark horse candidate to buy a pen manufacturer?Harris WilliamsMergers and Acquisitions · Richmond · 2025
Say this
I would look for buyers who want the capability rather than the product. An injection-moulding or precision-plastics group buying for the manufacturing asset, or a promotional-products and corporate-gifting business buying for the channel.
Then walk it
- The obvious buyers are other stationery brands and their sponsors. Those are not dark horses, so I would name them and move past them.
- The manufacturing angle: a pen is a high-volume precision plastics and micro-assembly business. A contract manufacturer in medical devices or cosmetics packaging could want that capacity and tolerance capability.
- The channel angle: whoever owns the shelf. A promotional products distributor, or a corporate gifting platform, buys the brand as a hook for a much larger merchandising catalogue.
- The brand angle: luxury. If the target has any premium line, a luxury goods group could take the brand and abandon the volume business entirely. That is a different valuation basis, brand not EBITDA.
- And the adjacency angle: an office-products distributor integrating backwards, or an Asian manufacturer buying Western distribution and brand. Each of these values a different asset inside the same company, which is the whole point of building a buyer universe properly.
Where candidates lose it
Naming only competitors. The word 'dark horse' means they want to see whether you can decompose the company into its separate assets, manufacturing, brand, channel, and find who values each one most. Structure the answer by asset, not by company.
Expect next
- Which of those pays the most?
- How would you approach them differently in a process?
- How would you value it for a luxury buyer versus a manufacturer?
Reported by candidates at Harris Williams (Mergers and Acquisitions, Richmond, 2025). Source: Wall Street Oasis.
Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.