Booth Team Wins Oxford Global Private Equity Challenge for Second Consecutive Year
For the second year in a row, a team of Chicago Booth students took the top prize at a global private equity competition, a success the winners credit to the diversity of their professional backgrounds and the in-depth counsel they receive from private equity veterans while at school.
Twelve universities were invited to enter the 2022 Oxford Global Private Equity Challenge, which is hosted by the Saїd Business School at the University of Oxford, the Oxford Saїd Finance Lab, and the Private Equity Institute.
The event challenges teams to assess the potential for a leveraged buyout of a publicly listed company of their choice, simulating the real-world experience of presenting to an investment committee.
Four finalist teams were selected to present their business cases to a judging panel at a virtual finals held May 26. The Booth team beat out fellow finalists from Oxford Saїd, Cambridge Judge Business School, and Columbia Business School.
Founded seven years ago as a contest between just Booth and Oxford, the Challenge three years ago expanded to be a global invitational for select business schools. Booth has won four out of the seven years.
“One of the keys to success is that we encourage diversity in teams on multiple dimensions,” said Chris McGowan, an adjunct professor of entrepreneurship at Booth who teaches several private equity courses, seminars and workshops. “We know diversity produces stronger teams.”
Booth requires teams competing in the Challenge to have one or more members with no prior private equity experience, in order to create an opportunity for students to learn from one another and to ensure career switchers have a chance to gain private equity experience, Prof. McGowan said. The talent mix has proven very beneficial in developing a successful growth strategy for the case challenge, especially when the team includes a member with prior experience in areas such as marketing, operations, or competitive strategy.
This year’s winning team had two teammates with prior private equity or investing experience; the other two members had worked in consulting and operations, resulting in a powerful combination of financial and strategic insights.
“I think that was the main reason we were successful,” said Greg Caraway, who worked in private credit prior to business school. “I don’t know if we would have won if we all came from the same industry.” Along with Caraway, the winning team included Kelsey Brongo, Corbon Heizer, and Alessandro Mocio, all first-year MBA students.
Another leg up the Booth team had was rigorous practice thanks to the Private Equity Case Challenge (PECC), an internal competition at Booth that mirrors the global contest. The winner of the PECC, a noncredit program underwritten by Chicago-based Water Street Healthcare Partners, goes on to represent Booth in the Oxford Global Private Equity Challenge.
As teams advanced through several rounds of the PECC, they received copious feedback from judges and the PECC’s two advisors, Prof. McGowan and Tim Kelly, to strengthen their analyses and presentations.
“Every time we spoke with them they poked holes in our argument and pointed out things we missed,” said Brongo, who held corporate strategy roles before Booth and participated in the PECC to gain exposure to the private equity industry and the deal process.
“We check their math, we check their logic,” said Kelly, MBA ’00, an investor-in-residence at Polsky who spent 30 years in private equity leadership roles. “It’s multiple rounds of feedback, which is clearly not just spoon-feeding them on this particular proposal but giving them a good foundation of this type of work into their private equity careers.”
Kelly and McGowan, who have seen thousands of investor presentations during their private equity careers, bring real-world best practices into the PECC feedback sessions to help teams avoid common pitfalls. For example, presenters must learn to feel comfortable with not having an answer to tough questions, Kelly said.
The advisors also encourage students to do primary research, going beyond publicly available materials to talk with consultants, bankers, lenders, company executives, industry experts, and others who could offer first-hand insights. This year’s winning team spoke with the chief financial officer of the facility services company they were analyzing.
“We have seen the winners over the years taking those extra steps to get insights from industry actors,” Prof. McGowan said. Students also have access to a database of example presentations from past Booth teams “so that they can go in knowing what ‘really good’ looks like,” he said.
The process does not only benefit the eventual winners. Each year up to 20 teams participate in the PECC, which involves submitting a 25-page investment committee presentation and five-year leveraged buyout model, and even those teams that don’t advance to the next round get at least an hour with McGowan and Kelly to review what they could have done better. This also gives students a private equity project to talk about when interviewing for PE internships, even if they don’t have any other PE experience.
“At a minimum, when you have PECC involvement on your resume it gives you a talking point in an industry that often requires you to have some form of prior experience,” Prof. McGowan said. “For prospective career switchers, this is really one of the earliest programs we suggest they participate in because the hardest thing to do for a career switcher is to break into private equity having done nothing related thus far. It’s been a great stepping stone for hundreds of Booth students looking to gain private equity experience over the last seven years.”