Free LBO Model Template: Blank Test and Answer Key (Excel)

Updated September 2026 · 9 min read

Most free LBO model templates are already built. You open the file, the formulas are in place, and you learn almost nothing. This one is deliberately the opposite. It is a blank LBO model test with labeled rows and no formulas, plus a completed answer key so you can check yourself line by line.

The prompt is a full five-year LBO with a term loan, mezzanine debt with PIK interest, a cash sweep, purchase accounting and a working capital build. It is close to what a real PE modeling test looks like, and it is designed to be finished in about an hour.

What Is in the Workbook

The PDF is the same prompt on one page, formatted so you can keep it open on a second screen or print it while you build.

The Prompt: Transaction Assumptions

A five-year hold, bought and sold at the same multiple, so the return has to come from EBITDA growth and debt paydown rather than multiple expansion.

Financing Assumptions

Three tranches, with the mezzanine carrying both cash and PIK interest. The PIK accrues onto the balance rather than being paid in cash, which is the detail most candidates forget to add back on the cash flow statement.

Purchase Accounting

Operating Assumptions

Revenue compounds at 8.0% while margins are held flat, so EBITDA growth is purely volume driven. That keeps the operating build simple and puts the difficulty in the debt schedule, which is where modeling tests are usually won or lost.

How to Use the Template

Build on the Template tab and leave the Answer Key closed until you are done, or you will end up reading a model rather than building one. Work in this order:

1. Sources and uses. Size the debt off LTM EBITDA, add the fees and minimum cash, and let the sponsor equity fall out as the plug.
2. Income statement. Grow revenue, hold the margins, and remember the incremental D&A created by the PP&E step-up.
3. Working capital. Convert the days assumptions into balances, then take the change as a cash item.
4. Cash flow. Add back D&A, the OID and fee amortization, and the mezzanine PIK, then subtract capex and the working capital build.
5. Debt schedule. Mandatory amortization first, then the sweep. The mezzanine balance grows by the PIK each year.
6. Returns. Exit EBITDA times the exit multiple, less net debt, divided by the entry equity.

If a section will not tie, get a balancing shell working before you layer in the sweep, the PIK and the purchase accounting. A simpler model that ties scores better than a fuller one that breaks.

Check Your Answer

If your model is built correctly, the returns land here:

Small differences are normal and usually come from rounding or from how you treated the fees. If you are more than a few tenths of a turn away on MOIC, the problem is almost always in the debt schedule: either the sweep is paying down more than the cash available, or the PIK is not accruing onto the mezzanine balance.

Why This Kind of Practice Works

Candidates who have built ten LBOs walk into a modeling test with the structure as muscle memory, which frees up their attention for the details specific to that prompt. Candidates who have built one or two spend half the clock deciding where the debt schedule goes. The gap is reps, not talent.

Build this one from the blank tab, then rebuild it a week later without looking. The second attempt is where the structure actually sticks. When you can complete it inside an hour with the returns tying, you are in reasonable shape for most case studies and modeling tests you will be handed.