How would you estimate WACC or weighted average cost of capital for a private company? I've never estimated WACC for a private company before, but I do know what WACC is. It reflects the average cost of debt and cost of equity for a company, and it gives us an insight into the total cost of capital for all investors. WACC is used to discount cash flows and a higher WACC means that the investors view a company as a riskier investment and therefore they'd give it a lower valuation. So if I was to estimate WACC for a private company, I would use a similar approach to when we use multiples to value a company, and that's to say to look at peer companies. So I would start by estimating the cost of debt and the cost of equity for other similar companies. The cost of debt I would estimate by looking at the borrowing cost of companies with a similar risk profile and leverage as the private company, as these are the main factors that can impact the cost of debt. And then to estimate the cost of equity, I would look at other similar companies within the industry. And to estimate equity, you the cost of equity, you would use the capital asset pricing model. Once I have my estimates for the cost of debt and the cost of equity, I would calculate WACC based on the proportion of debt and equity within the company's capital structure. This is a very hard question to get exactly right, but the point of it is that the interviewer is trying to find out where the interview is, knowledge begins and ends. But it's also a great question because many interviewees will have something to say about WACC and the interviewer can probe your knowledge to see if you can get to the answer with a few prompts. So say what you can, which is exactly what this interviewee has done. There are much more complex answers to this question, which involve an exploration of the capital asset pricing model and de-leveraging betas, et cetera. But I would not worry about those many interviewees who have a little knowledge here will quickly get out of their depth. So revise what you know and stick to it.