5. The average expected value (NPV) from a completed deal is $4M. Due to the time value of money and goodwill-related costs, the firm loses an estimated 1% of the deals value for each week that it is in process. Given these considerations, did your optimal staffing recommendation (to maximize Durians annual profit) change?

Mendocino Capital, a successful private equity firm based out of Silicon Valley, is eyeing the recent economic growth throughout south-east Asia, knowing that to do business in the region would require it to open a full-fledged office. After careful due diligence, it decides to open a regional branch in Singapore Founded five years earlier, Mendocino Capital has witnessed tremendous growth, focusing on the technology sector. Thanks to its strong track record, domain expertise and well- established relationships, it has secured a $200 million commitment from investors which it will use to seed a new fiund in Asia, Durian Capital. Although that amount is sufficient to launch operations, its senior professionals in Asia will be expected to raise more. Durian Capital needs a robust operational plan to pitch to potential investors in which human resources play a key part. Investors will be counting on the Asian team to achieve substantial retums on their investment. Like its parent organization, Drian Capital has to be extremely selective in the hiring process. Operations will be relatively lean and flat, not least because top talent is in short supply and therefore expensive to recruit Based on past e and a structured approach to problem solving, Durian Capital knows the deal-making process in detail to determine its HR he value of v requirements. This follows a linear flow in which Durian Capital employs specialists for each step of the process, as illustrated below. Due diligence Deal completion Preliminary Negotiation 50% abandonment 2/3rd abandonment 80% abandonm ent Abandonment can occur after each stage in the process. In other words, of 30 deals to go through preliminary evaluation in a year, about 15 will go through due diligence, five through the negotiation phase, and one will finally reach completion. The time and resources required at each stage are summarized in the table below: Step l Step 2 Preliminary Due diligence Negotiation evaluation Deal completion Process 150 hrs/transaction hrs/transaction hrs/transaction 80 100 hrs/transaction 120 liine professional professional As many of the deals are sourced from personal and professional networks, it is important that the same senior professional who negotiated the deal completes the transaction. Other than deal making, senior professionals must also spend time on activities such as firm management, leal sourcing, mentoring and training, and project management For the purpose of planning, iris reasonable to assume that junior, mid-level, and senior professionals need to spend 25%, 50%, and 23 of their time respectively on other activities. Junior professionals typically work 65 hours per week, and mid-level and senior professionals work 60 hours per week. All of them work 49 weeks per year. eal sorcle to assue that jmnion. niah lher actvinies. Junior profsesaup Mendocino Capital, a successful private equity firm based out of Silicon Valley, is eyeing the recent economic growth throughout south-east Asia, knowing that to do business in the region would require it to open a full-fledged office. After careful due diligence, it decides to open a regional branch in Singapore Founded five years earlier, Mendocino Capital has witnessed tremendous growth, focusing on the technology sector. Thanks to its strong track record, domain expertise and well- established relationships, it has secured a $200 million commitment from investors which it will use to seed a new fiund in Asia, Durian Capital. Although that amount is sufficient to launch operations, its senior professionals in Asia will be expected to raise more. Durian Capital needs a robust operational plan to pitch to potential investors in which human resources play a key part. Investors will be counting on the Asian team to achieve substantial retums on their investment. Like its parent organization, Drian Capital has to be extremely selective in the hiring process. Operations will be relatively lean and flat, not least because top talent is in short supply and therefore expensive to recruit Based on past e and a structured approach to problem solving, Durian Capital knows the deal-making process in detail to determine its HR he value of v requirements. This follows a linear flow in which Durian Capital employs specialists for each step of the process, as illustrated below. Due diligence Deal completion Preliminary Negotiation 50% abandonment 2/3rd abandonment 80% abandonm ent Abandonment can occur after each stage in the process. In other words, of 30 deals to go through preliminary evaluation in a year, about 15 will go through due diligence, five through the negotiation phase, and one will finally reach completion. The time and resources required at each stage are summarized in the table below: Step l Step 2 Preliminary Due diligence Negotiation evaluation Deal completion Process 150 hrs/transaction hrs/transaction hrs/transaction 80 100 hrs/transaction 120 liine professional professional As many of the deals are sourced from personal and professional networks, it is important that the same senior professional who negotiated the deal completes the transaction. Other than deal making, senior professionals must also spend time on activities such as firm management, leal sourcing, mentoring and training, and project management For the purpose of planning, iris reasonable to assume that junior, mid-level, and senior professionals need to spend 25%, 50%, and 23 of their time respectively on other activities. Junior professionals typically work 65 hours per week, and mid-level and senior professionals work 60 hours per week. All of them work 49 weeks per year. eal sorcle to assue that jmnion. niah lher actvinies. Junior profsesaup