by: Claudia Capos
Nine University of Michigan student teams will square off against each other on Thursday, December 12, during the annual private equity “battle of the pitches,” held by the Center for Venture Capital and Private Equity Finance, or CVP, at the Ross School of Business.
Only two teams will advance to the “Bake-off” semifinals, where they will have a shot at winning this year’s Brophy-Gelband Merit Scholarship and $10,000 in prize money.
The event will be held in the Ross School’s Blau Auditorium, and is open to members and friends of the U-M student, faculty and alumni community at 6 p.m.
The 12th annual Private Equity “Bake-off” competition serves as the capstone event for MBA and U-M graduate students enrolled in Professor David J. Brophy’s Private Equity Finance course.
For this highly anticipated interclass challenge, each student team will present a detailed proposal for a private-equity takeover of an existing public company. A judge’s panel composed of private equity investors and investment practitioners will rank the teams by the quality, comprehensiveness and attractiveness (in terms of projected return on investment) of their public-to-private buyout pitches. Then the judges will narrow the competitive field to two semi-finalists.
During the “Bake-off,” the Blau Colloquium audience of students, alumni and sponsors will cast popular votes for the semifinalist team with the best buyout pitch. The winner will receive the Brophy-Gelband Merit Scholarship and take home $7,500 in prize money. The runner-up will receive $2,500.
“Alan Gelband, an alum and great friend of U-M Ross, joins us in facilitating student access to opportunities in the private equity and alternative investment field,” Professor Brophy says. “Graduates of this and other Center for Venture Capital and Private Equity Finance (CVP) courses and competitions are now private equity fund leaders globally and providing continued support for our programs and conferences.”
At the beginning of the fall term, Professor Brophy assigned the student teams to select and evaluate a middle-market public company for a possible “model” private-equity acquisition. The students used publicly available financial records to assess the company’s management, revenue, profits and market position, and subsequently to project the estimated return on investment for private equity investors. Based on this extensive information gathering and financial analysis, each team formulated a buyout pitch for the target company it had chosen.
Alan Gelband, BBA ’65, MBA ’67, the benefactor for the annual Bake-off award, says the public-to-private buyout competition serves both as a learning tool for students and a talent pipeline for the PE industry.
“This is an important exercise for anyone who wants to get into private equity, which is a leader of business evolution today,” says Gelband, the founder and managing director at Gelband & Co. investment banking.
Other Ross and CVP alumni and regional private equity investors who volunteer as judges also play a formative role during the annual Bake-off competition by providing constructive feedback on the teams’ buyout pitches and suggesting ways to strengthen their written and oral presentations. This year’s roster of judges includes investors from regional and national private equity firms.