5 Year LBO Financial Model with T12 and T3 Input Frameworks, Waterfalls, and More

Enhance your evaluation of new business acquisitions with this effective LBO model. It includes input frameworks for both Trailing 12-month (T12) and Trailing 3-month (T3) data, along with a variety of financing options. Tailor your analysis with entry multiples (based on EBITDA, Revenue, or Manual Entry) and exit multiples using the trailing 12-month EBITDA multiple. The model also includes detailed projections for expected revenue growth, cost of goods sold, operating expenses, and debt service coverage ratio. Streamline your deal analysis with this versatile financial model template.

$45.00 USD

After purchase, this template will be immediately available to download. It is also included in the joint venture waterfall models bundle, valuation templates bundle, industry-specific models bundle, and The Super Smart Bundle.

leveraged buyout model

I've done one other template specifically for LBO modeling, but that version does not include T12 inputs or an IRR hurdle waterfall, but it is more complex in the logic for accounts receivable / payable and inventory and it includes a 3-statement model. The LBO model you see on this page is more simplistic and easier/quicker to enter data into.

Template Details:

  • Output 5-year Monthly and Annual Pro Forma (profit/loss and cash flow).
  • Output project DCF Analysis (levered and unlevered).
  • Configure a waterfall with IRR hurdles and a GP catchup feature as well as GP fee options.
  • Purchase price based on 3 options (select dropdown) for EBITDA, Revenue, or manual entry.
  • Run for up to 60 months.
  • Define the % of total purchase price financed with a loan. (output data for levered/unlevered).
  • T12 and T3 input tabs for historical data, with mapping to pro forma line items for in-place data references.
  • Up to 5 revenue sources and inputs for the revenue growth per month (adjustable by quarter) for each.
  • Inputs for 3 contra revenue items (refunds, returns, or what have you).
  • 5 costs of goods sold, or direct cost items defined as a % of total revenue and adjustable by quarter.
  • Specific line items for sales and marketing spend (great for ecommerce business acquisitions).
  • Input of new OPEX items and define the monthly growth of each by quarter.
  • Define if exit value is to be included or not and if so, the EBITDA multiple.
  • Up to 5 capex items that let the user input data per month.
  • Solves for the minimum equity required.
  • IRR sensitivity table is based on sensitizing exit multiple and leverage rate.
  • Project-level outputs include IRR and net cash produced.
  • GP/LP-level outputs include IRR, MOIC, ROI, total invested, total distributed, and total GP fees.
The point of this finance tool is to help individuals or organizations that want to acquire new businesses. There is an importance put on historical data and a projection can be based on that data. The user can adjust all assumptions to see how certain changes to variables affect the financial feasibility of a deal.

There is no specific industry this financial model is targeted for. Instead, it is designed to fit any business. The assumptions are more top down rather than bottom up and the one benefit to doing that is you can build a projection for nearly anything.

Some extra features I added include a weight that can be assigned to the T12 and T3 historical average monthly revenue figures. The weighted average of the two is used to come up with the starting basis for revenue. Also, there is a sign switcher toggle on the 'Validation' tab to help the historical data fit the pro forma better. This is an important part of the model since it allows you to ensure the right values are hitting your 'in-place' EBITDA. For example, if refunds come through as a positive value on the t12, you want to mark 'yes' on the sign switcher for that section so the value comes through as a negative on the pro forma in-place section for contra revenue, otherwise it will be double counted the wrong way.

If you find that this template requires specific financial modeling customizations to better suit your needs, or if you need assistance with adjusting the model's logic or using it for the first time, I am available on demand at my standard hourly rate. You can conveniently purchase consulting time here.

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