Private Equity interview preparation

Questions

100

Traced to a firm

83

Firms

40

Updated

September 2026

Asked at

All firmsAdvent International6Apollo Global Management6Audax Group6Carlyle Group6EQT6Silver Lake6Vista Equity Partners6WPWarburg Pincus6HIH.I.G. Capital5Oaktree Capital Management5Platinum Equity5TPTPG5General Atlantic4AMAres Management3Blackstone3Clayton Dubilier and Rice3GSGuggenheim Securities3Insight Partners3Invesco3Lazard3Neuberger Berman3NUNuveen3TSTruist Securities3Bain Capital2HWHarris Williams2Kohlberg Kravis Roberts2Millennium Management2Moody's2Rothschild & Co2WBWilliam Blair2Bessemer Venture Partners1Citi1Evercore1FTFranklin Templeton1Houlihan Lokey1HPS Investment Partners1KKR1Mizuho1MSMorgan Stanley1Sycamore Partners1

Topic

All topicsLBO mechanics7Value creation5Returns2Fund economics9Investment judgement18Valuation6Firm knowledge2Credit and financing9Operations4Due diligence8Career and fit11Sector knowledge4Accounting2Deal structuring7Industry knowledge3Brainteasers3

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Type

AnyTechnicalCaseFitMarket viewBrainteaser

1. 001Walk me through an LBO.LBO mechanicsCorefirst roundTPTPGInvestment Banking · New York · 2024Advent InternationalTechnology, Media and Telecom · Palo Alto · 2020Advent InternationalPrivate Equity · New York · 2021TSTruist SecuritiesGeneralist · Charlotte · 2024

   Say this

   Buy a business mostly with debt, use its cash flow to pay that debt down, improve the operations, then sell in five years. The equity return comes from deleveraging, EBITDA growth and any change in the exit multiple.

   Then walk it

   1. Entry: agree a purchase price as a multiple of EBITDA, then build sources and uses. Debt goes in as far as the credit market will support, say five times EBITDA, and the sponsor funds the rest plus fees.
   2. Operating model for five years, then the debt schedule: interest, mandatory amortisation, and a cash sweep applying surplus cash to repay debt.
   3. Each year free cash flow after interest reduces debt, so the equity slice grows even with a flat enterprise value.
   4. Exit at an assumed multiple on final-year EBITDA, subtract remaining debt, and that is exit equity.
   5. Compute IRR and money multiple, then attribute the return across the three drivers. An investment committee will always ask which one carries the deal.
   6. The discipline point: if the return only works on multiple expansion, it is not a thesis, it is a market bet. I would want it to clear on deleveraging and EBITDA alone.

   Where candidates lose it

   Describing the mechanics without attributing the return. Every serious LBO answer ends with which of the three drivers produces the IRR and an acknowledgement that multiple expansion is the one you do not control.

   Expect next

   • How does private equity create value?
   • Do a paper LBO for me.
   • What makes a good LBO candidate?

   Reported by candidates at TPG (Investment Banking, New York, 2024); Advent International (Technology, Media and Telecom, Palo Alto, 2020); Advent International (Private Equity, New York, 2021); Truist Securities (Generalist, Charlotte, 2024). Source: Wall Street Oasis.

2. 023What would make you walk away from a deal in diligence?Due diligenceIntermediatetechnicalAdvent InternationalPrivate Equity · Boston · 2022

   Say this

   Anything that breaks the thesis rather than just the price. Integrity problems, undisclosed liabilities, or discovering that the earnings are not what they appeared. Most other findings are price adjustments.

   Then walk it

   1. Integrity issues are absolute: evidence of misrepresentation, undisclosed related-party dealing, or a management team that has been misleading. You cannot own a business with people you cannot trust, and no discount compensates.
   2. Earnings that are not real: quality of earnings revealing that adjusted EBITDA is materially overstated, or revenue recognition that pulls forward future periods.
   3. Concentration you cannot mitigate: a single customer at 40 percent of revenue with a contract expiring in a year, and no ability to speak to them before closing.
   4. Structural market deterioration discovered in commercial diligence: substitution, a regulatory change, a competitor's product that changes the economics.
   5. Then the distinction that matters: most findings are price and structure issues, not deal-breakers. A pension deficit or an environmental liability can be handled with an indemnity, an escrow or a price cut.
   6. So my framing would be: if the finding changes the value, we renegotiate. If it changes whether the business is what we thought it was, or who we would be in business with, we walk.

   Where candidates lose it

   Listing findings without the price-versus-thesis distinction. Sponsors renegotiate constantly and walk rarely, so the judgement being tested is knowing which category a finding falls into.

   Expect next

   • How would you renegotiate rather than walk?
   • What is an escrow for?
   • Have you ever been on a deal that broke?

   Reported by candidates at Advent International (Private Equity, Boston, 2022). 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.