Private Equity Investing Fundamentals

4 credits · GSB

Excellent investing is a craft that combines both science and art. This course offers a practitioner's introduction to the fundamentals of private equity investing, focusing on long-term, private, illiquid, and leveraged investments. It is designed for students with little or no prior experience in private equity or investing. The first half of the course builds the investor's toolkit: industry analysis, company evaluation, valuation methodologies, capital structure construction, and disciplined investment decision-making. It then puts students in the seat. Through a single in-depth case study, students follow one real company from its 2015 buyout through the COVID-19 pandemic to its IPO and eventual exit. Midway through the course, student deal teams present a buyout proposal to an investment committee that includes the company's actual lead private equity investors, then study the decision those investors made and how it played out. The second half applies the same frameworks well beyond a single buyout, covering the history and future of private equity, the macroeconomic and market backdrop, public market investing and spotting winners and losers, sports franchises as an emerging asset class, and investing in the era of AI. World-class investors and industry experts join nearly every session, including founders and CEOs, senior partners of the largest private equity firms, economists, and public market investors. On the last day of class, students receive a real Confidential Information Memorandum (CIM) and write an individual investment memo in class, using all the tools developed during the quarter. By the end of the course, students will have practical frameworks to evaluate and execute private investments with confidence, and will begin to think like an investor. Advanced finance is not required, but students should be comfortable with basic accounting, financial statements, and net present value (NPV) concepts.