Finance and Accounting
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Private Equity Valuation Guidelines
Private Equity Valuation Guidelines Below is a summary and personal interpretation of the International Private Equity and Venture Capital (“IPEV”) Guidelines to estimate the fair value of investments as part of a private equity funds’ reporting to its limited partners. These guidelines contain a useful wrap-up of valuation best practices in a private equity context. Continue reading
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How To Assess The Quality of Earnings
Quality of Earnings, by Thornton O’Glove I came across Quality of Earnings, written in 1987 by Thornton O’Glove (co-authored by Robert Sobel), in my quest to understand the history of “quality of earnings” analysis. Thornton O’Glove worked as a stockbroker and financial analyst for various firms, with a particularly contrarian and skeptical approach compared to Continue reading
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Financial Statements – How To Detect A Fraud
Financial Shenanigans, by Howard M. Schilit Financial Shenanigans It is common for leveraged buyout practitioners to have the accounts of companies they are investigating scrutinized by specialized departments of audit firms. The goal, among others, is to determine (i) the Adjusted EBITDA figure on which to apply the appropriate EV/EBITDA multiple (“quality of earnings”) and Continue reading
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About THE AUTHOR
- I have been a private equity investor for 17 years, and prior to that, a leveraged finance banker for 3 years. During the past 20 years, I have worked on transactions with a cumulated value of €13 billion, alongside talented founders, managers, investors, bankers, and advisors.
- I have served on the board of private European companies of various sizes (from €5 million to €200 million of EBITDA) in various industries (food, wealth management, education, access control, dental services, real estate financing, publishing, building materials, capital equipment).
- I teach an Introduction to Private Equity course at my alma mater, HEC Paris, hold a CFA charter, and am passionate about investing (I manage a portfolio of listed stocks on the side for my own account), business, social sciences, and mental models.
- I am blessed with a wonderful wife and three amazing children.