Where to Find LBO Modeling Tutorials Online (Free and Paid)
- Peak Frameworks Team
- 6 hours ago
- 6 min read
If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year.
If you are preparing for private equity or investment banking interviews, learning to build a leveraged buyout (LBO) model is non-negotiable.
This guide lists where to find the best LBO modeling tutorials online, what each resource does well, and the core concepts you should drill.
One thing to keep in mind before we start: building LBO fluency comes down to repetition.
You will not master it from one video. You master it by building the same model five, ten, twenty times until the mechanics feel automatic.
What an LBO Model Actually Tests
An LBO model calculates the returns a private equity firm earns when it buys a company using a mix of debt and equity, then sells it a few years later. The "leverage" is the debt. Because debt sits ahead of equity and gets repaid over the hold period, even modest operating improvements can produce large equity returns.
Every full LBO model moves through the same building blocks:
Transaction assumptions (purchase price, entry multiple, debt-to-equity split)
An operating model that forecasts revenue, EBITDA, and free cash flow
A sources and uses schedule
A debt schedule that tracks paydown and interest
A returns calculation, usually internal rate of return (IRR) and multiple of money (MoM)
When you evaluate any tutorial below, check that it covers all five. A walkthrough that skips the debt schedule teaches you half the model.
Where to Find LBO Modeling Tutorials Online
1. Peak Frameworks Private Equity Course
We built our Private Equity Course around the way real firms test candidates, so the LBO content moves from theory into full builds.
The curriculum covers the debt schedule, revolver, cash flow waterfall, PIK interest, IRR, and MoM, then applies all of it across a dedicated set of Paper LBO drills with worked answers.
Our founders previously worked at firms including Silver Lake Partners, Providence Equity, TPG Capital, and Evercore, so the models reflect on-the-job standards rather than textbook simplifications. If you want a structured path instead of stitching together scattered videos, this is the most direct option.
Best for: candidates who want a recruiting-specific sequence from fundamentals to full models.
2. Rareliquid on YouTube
Rareliquid, run by former JP Morgan investment banker Ben Chon, is one of the best free starting points. His video "How to Build a Leveraged Buyout (LBO) Model in 5 Steps"Â has drawn more than 300,000 views since March 2023 and walks through a simple model in Excel with a downloadable template.
What makes Rareliquid useful is the progression. You can start with the simple five-step build, then move to longer tutorials that model real transactions, including a multi-billion-dollar buyout with a full debt schedule, circularity, and a circuit breaker for the interest calculation. The channel is free, which makes it a low-risk way to test whether you actually enjoy this work before you commit to a paid course.
Best for: visual learners who want to follow along in Excel at their own pace.
3. Financial Edge Training
Financial Edge trains analysts at several bulge-bracket banks, and the firm publishes a free LBO Model guide that breaks down the model's aim, types, and assumptions. The written format works well as a reference you return to between practice sessions.
The firm also runs occasional live sessions built around current deals. One recent webinar walked through 3G Capital's roughly $9.4 billion acquisition of Skechers and made the model available to attendees. Working from a real, recent transaction is a useful reality check once you have the basic mechanics down.
Best for: readers who learn from written guides and want exposure to live deal teardowns.
4. Breaking into Wall Street
Breaking into Wall Street is a strong program aimed at early-career finance candidates, with hands-on training that mirrors the work analysts perform on the job. They are a trusted name in the industry that has a strong focus on investment banking roles.
Their founder Brian Dechesare is one of the leading voices in finance training and has a large library of quality resources.
Best for: students who want a time-tested resource with a focus on banking.
Key Concepts to Master Before Your Interview
Tutorials show you the mechanics. These concepts are what interviewers actually probe. Drill them until you can explain each one without notes.
The Paper LBO
A Paper LBO is the simplified, pen-and-paper version of the full model, and it shows up constantly in private equity interviews. You typically get under ten minutes, rounded numbers, and an instruction to show your work. Our Paper LBO walkthrough runs a full example: a company bought at 10x EBITDA, financed with 5x leverage, exited after three years, with the implied MoM and IRR computed by hand.
Master the Paper LBO first. It forces you to understand the logic of the model without hiding behind Excel formulas.
IRR and Multiple of Money
These are the two return metrics every LBO produces. Internal rate of return (IRR)Â is the annualized return on the equity investment, while MoM is the simple ratio of cash out to cash in. A 3.0x MoM over five years and a 2.0x over three can imply similar IRRs, so know how the two relate and what drives each.
The Debt Schedule
The debt schedule is where most beginners stumble. It tracks how much debt the company carries each year, how much free cash flow goes toward paydown, and how interest expense changes as the balance shrinks. The interest-on-debt and debt-on-interest relationship creates a circular reference, which is why tutorials introduce a circuit breaker switch to control it.
Sources and Uses
The sources and uses schedule confirms that the money raised (debt plus sponsor equity) equals the money spent (purchase price plus fees). It anchors the entire transaction, so get comfortable building it early.
How to Actually Get Good: Repetition
Here is the part most guides skip. Watching tutorials feels productive, but watching is not building. The candidates who walk into modeling tests calm are the ones who have built the same model enough times that the structure is muscle memory.
A practice loop that works:
Follow a tutorial once, pausing to build alongside the instructor.
Rebuild the same model from a blank sheet, checking the tutorial only when stuck.
Rebuild it again with no reference at all.
Change the assumptions (higher leverage, different exit multiple) and confirm the outputs still make sense.
Time yourself on a Paper LBO version until you can finish in under ten minutes.
Comfort in Excel speeds this up. Learn the shortcuts so the software stops slowing you down and you can focus on the logic. Expect the first few builds to feel slow and frustrating. That is normal. The mechanics click somewhere around the fifth or sixth rebuild, not the first.
Frequently Asked Questions
Are free LBO tutorials enough to pass a modeling test?
For a simple modeling test, free resources like Rareliquid combined with steady practice can get you there. For on-cycle private equity recruiting or harder buy-side tests, a structured course with graded model tests and worked Paper LBOs closes the gap faster, because you get feedback on where your build breaks.
How long does it take to get comfortable with LBO modeling?
Most candidates need several weeks of consistent practice, not days. Plan to rebuild a model many times. If you practice a few hours a week, expect roughly four to eight weeks to feel confident with a standard LBO, and longer for advanced features like preferred equity or dividend recaps.
What should I learn first, the Paper LBO or the full model?
Start with the Paper LBO. It teaches the underlying logic (entry, cash flow, debt paydown, exit, returns) without the distraction of Excel formatting. Once the logic is solid, the full Excel model becomes a matter of adding detail rather than learning new concepts.
Do I need an LBO model for investment banking interviews too?
Yes, though the depth varies. Many investment banking groups expect at least a working understanding of LBO mechanics, and leveraged finance and sponsors coverage teams use them heavily. Private equity interviews go deeper, but the foundation is the same.
Where to Start
If you want one free first step, watch Rareliquid's five-step tutorial and build along in Excel. If you want a structured path from fundamentals to recruiting-ready models, our Private Equity Course sequences the LBO content with Paper LBO drills and model tests. Either way, the rule holds: pick one model, build it until it is automatic, then build it again.