Investment Banking, 3rd Edition

Introduction

In the constantly evolving world of finance, a solid technical foundation is an essential tool for success. Due to the fast-paced nature of this world, however, no one was able to take the time to properly codify the lifeblood of the corporate financier’s work—namely, valuation and dealmaking. We originally responded to this need in 2009 by writing the first edition of the book we wish had existed when we were trying to break into Wall Street. Investment Banking: Valuation, LBOs, M&A, and IPOs, Third Edition is a highly accessible and authoritative book written by investment bankers that explains how to perform the valuation work at the core of the financial world. Our book fills a noticeable gap in contemporary finance literature, which tends to focus on theory rather than practical application.

As the world of finance adjusts to the new normal of the post-Great Recession era, it merits revisiting the pillars of our second edition for today’s environment. While the fundamentals of valuation and critical due diligence for mergers & acquisitions (M&A), capital markets, LBOs, initial public offerings (IPOs), and other public investment opportunities remain intact, the environment is constantly evolving. This involves the use of more realistic assumptions governing approach to growth and risk, including expected financial performance, discount rates, multiples, leverage levels, and financing terms. While valuation has always involved a great deal of “art” in addition ...