From explanation to application
Work through the deal mechanics.
These examples isolate a decision or calculation. Their labels distinguish hypothetical illustrations, proposals, and reported experience. None is a ready-made investment case.
- Hypothetical
A thin cushion after scheduled debt service
Use a fictional cash-flow case to test the room left after senior and seller debt payments.
- Hypothetical
A deferred payment creates a future funding gap
Reconcile a fictional purchase schedule with cash expected when deferred consideration falls due.
- Hypothetical
£5k a month funds a search, not the acquisition
Compare search duration, monthly spending and the ownership offered to an early backer.
- Proposed
£33m debt conditional on £25m equity
See why a large debt proposal can remain unavailable until its equity condition is met.
- Hypothetical
From recorded equipment value to an eligible borrowing base
A fictional collateral calculation separates accounting value, eligible assets and an assumed advance rate.
- Hypothetical
Separate a supported expense adjustment from a recurring cost
A fictional earnings review tests what evidence supports removing a one-time expense.
- Hypothetical
Compare a preference with conversion into common equity
A fictional nonparticipating preference illustrates how sale proceeds may be allocated between share classes.
- Hypothetical
The £800k monthly revenue covenant illustration
Calculate a hypothetical monthly revenue floor and distinguish covenant headroom from available cash.
- Hypothetical
Translate a partial equity purchase into an implied value
A fictional proportional calculation separates cash paid for a stake from the value implied for retained shares.
- Hypothetical
Funding a £3.5m purchase
Allocate the illustrated purchase price among bank debt, seller deferral and equity without confusing funding with ownership.
- Proposed
A €952k debtor balance is not a €952k lending base
Separate customer invoices from the wider debtor balance before estimating borrowing capacity.
- Hypothetical
A £3.5m valuation from two years of earnings
Average the stated pretax profits and compare how the chosen year changes the apparent multiple.