Browse CFA Level 1

Chapter 3: Investments in Private Capital (Equity and Debt)

In this section

  • Private Equity (Venture Capital, Buyouts, Distressed)
    Explore the fundamentals of private equity investing across venture capital, buyouts, and distressed strategies, along with key value drivers, risks, and best practices for CFA Level I candidates seeking a deeper understanding of the private capital landscape.
  • Private Debt and Direct Lending
    Comprehensive coverage of Private Debt and Direct Lending strategies, structures, and risk-return profiles for the CFA® 2025 Level I exam, including direct lending fundamentals, regulatory influences, and portfolio applications.
  • Due Diligence and Selection Criteria
    An in-depth exploration of the crucial steps, frameworks, and best practices in performing comprehensive due diligence for private equity and debt investments.
  • Valuation Approaches, Exit Strategies, and Liquidity
    Discover how private equity valuations leverage DCF, comparable analysis, and more, plus key exit strategies, liquidity considerations, and real-world tips for CFA candidates.
  • Growth Equity and Minority Investments
    An in-depth look at how capital infusion through growth equity and minority stakes can accelerate expansion while preserving founder autonomy.
  • Leveraged Buyout Financial Modeling
    A deep dive into the mechanics, structure, and practical steps of building an LBO financial model, covering sources and uses of funds, capital structure analysis, key ratios, and scenario testing for robust decision-making.
  • Management Team Evaluation and Governance
    Explore strategies for evaluating leadership teams and establishing robust governance frameworks in private equity and debt investments.
  • Investor Protections and Term Sheet Analysis
    Explore the critical components of private investment term sheets, focusing on investor protections, valuation, liquidation preferences, anti-dilution clauses, and governance rights. Gain practical insights into negotiating balanced terms and mitigating key risks.
  • Structured Private Capital Solutions
    Exploration of hybrid financing options—combining features of debt, equity, and specialized securitizations—to address unique capital needs in private markets.
  • Mezzanine Financing and Convertible Instruments
    Explore mezzanine financing and convertible bonds for private capital structures, covering subordinated debt, equity components, negotiation points, risk-return, and real-world implementation.
  • Turnaround Expertise and Advisory Platforms
    A comprehensive look at how specialists revive distressed companies, from operational restructuring to strategic realignment, focusing on the pivotal 100-day plan and the role of advisory platforms.
  • Tax-Efficient Holding Company Structures
    Explore strategic tax-efficient holding company structures for private capital investments, including SPVs, best practices, and compliance with evolving international regulations.
  • Post-Investment Value Creation Methods
    Discover how private capital investors drive growth, enhance revenues, optimize operations, and steer strategic initiatives post-investment to maximize returns for stakeholders.
  • Fund Restructuring and Extension Strategies
    Comprehensive exploration of private fund extensions, restructuring options, governance mechanisms, and best practices for maximizing investor value.
  • Secondary Transactions in Private Equity and Debt
    A comprehensive look at secondary transactions in private equity and debt, exploring motivations, valuation, negotiation, legal constraints, and practical best practices for CFA candidates.
  • Trends in ESG and Impact-Focused Capital
    Explore how ESG considerations are reshaping private equity and debt investments, impacting due diligence, valuation, and strategic exits, all while driving measurable social and environmental outcomes.
Wednesday, April 9, 2025 Monday, January 1, 1

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