WSO Weekly Wrap-Up (3/14-3/20)

In case you missed them, here's some of last week's most popular topics:

My Private Equity Recruiting Process
Post By @Candor

If you have a deal on your resume, expect some of the headhunters, who are former bankers (e.g. CPI, Glocap, HSP), to ask you to walk through the deal. I had kids in my group not prepared for these meetings and got grilled (CPI did this). They did not receive any interviews from that headhunter, while I received multiple interviews because I came prepared.

Another thing I’d like to note is that, while the headhunters are the middle men in the hiring process, you also play an important role and it is in their best interest to meet as many candidates as possible to try to place as many people as possible. That’s how they get paid. They understand that you’re a banker and there are a lot of demands on your time/life, so it is perfectly reasonable to wait to respond to their introductory emails several weeks (or months) later to make sure you’re ready.

Response to "My Private Equity Recruiting Process"
Post By @NorthSider

1. I heartily disagree with the idea that having a closed deal at all differentiates you as a candidate. Being able to list the names of the parties involved because it's announced offers you no edge, ipso facto.
2. Not being long-winded can't be stressed enough.
3. There is a huge proportion of interviewees with significant mistakes in the model test. Generally, if it was clear the candidate understood the concepts and was slipped up by time pressure, it wasn't a 'ding', but those who submitted a perfect model undoubtedly differentiated themselves. "Top candidates" generally offer more thoughtful answers out-of-the-gate.

But why aren't there activists?
Post By @"Oddball Stocks"

The market is filled with activist investors who embody both the French and the German approaches to war. Some investors plot and plan, build 500 page Powerpoint slide decks and carefully telegraph their intentions at investment conferences. Others take the approach of buying a stock with gusto and approach their target with guns a-blazin'. Sometimes these approaches work, but they're both prone to backfiring as well!

Jeff Moore who writes at Ragnar is a Pirate recently engaged in a battle with the small company Sitestar (SYTE). Jeff managed to get a Board seat and its management still pulled out a bag of tricks, from fraudulently signing his name to documents to making false claims. Jeff and a group of shareholders filed a lawsuit against the company to which the company responded with their own litany of tricks. Moore eventually prevailed, but it's yet to be seen if any change can happen.

The value imposers
Post By @"Oddball Stocks"

Buffett matured from a small time investor at the fringe of the market to a star that the rest of the market orbits around. His quotes have found a home in almost any market situation. Even a trader might be caught saying "Be fearful when others are greedy." Buffett's quotes are like horoscopes, ambiguous enough that they apply to any investor in any market situation.

My point is that Buffett has become the market, and at this point mimicking what he does gives results no different than what the market generally does. Why not buy an index fund?

Buffett's success came from being different. It's a shame that instead of learning that lesson from him, investors have instead embraced trying to copy him. If you want different investment results than the market, you need to think and invest differently. If you don't you might as well invest in an index fund and forget about the market.

Hedge Fund Reinsurance: Why hedge funds care about (re)insurance
Post By @nkhanlegend

Hedge funds have typically invested in reinsurers through sidecars or buying an equity stake in a reinsurance company, but now hedge funds are beginning to launch their own reinsurance businesses. Hedge fund backed reinsurers' investment strategies are far more risky than those of traditional reinsurers. And generally, riskier entities are more capital intensive.

At the end of the day, can combining hedge funds and reinsurers create additional diversification benefits that don’t occur in either structure independently?

Finished Busy Season in B4 Audit: AMA
Post By @"Lester Freamon"

At the end of the day, a lot of auditing can be simplified by asking the following question: "Can we trust the number that management has listed". From that question, you have to break things down to their simpler components by understanding the process they used to come up with it, thinking about areas of weakness, and then selecting transactions that are higher risk. From there, and once you work on more complex line items, you can then think about GAAP, it's application, if there is a better way to account for something, etc.

My Dating Philosophy
Post By @"Easy C"

Use the "brad pitt" rule with girls.

In other words, ask yourself a simple question: "If I were Brad Pitt (or any other attractive celebrity of your choice), would this girl be behaving the way she is?" If you were Brad Pitt would she flake on a date? Would she suddenly need to "use the bathroom" while talking to you if you were a famous actor?

You know the answer to that question.....and deep down you know what that says about her level of interest in you. Following this rule has dramatically improved the quality of my own relationships, culminating with my wife. I highly doubt that she'd treat any celebrity better than she treats me.

If you're using online dating it applies there. Don't waste your time with girls who aren't responding to your messages quickly and enthusiastically. Girls these days have their damn phones within arm's reach 24/7 so there's rarely any reason why she should take longer than a few hours to get back to your texts/emails/calls.

What Do Guys Like to Eat?
Post By @LittlemissCEO

If a girl offered to make you a homemade meal, what would you request? Also, if anyone has any recipes they want to share, that would be great! Thanks!

This is what we imagine when you kids ask "should I start my own fund?"
Post By @thebrofessor

The emails to clients are gold.

"you idiot f*ck" / "I'm a human being" / "you know that I love you"

To anyone out there wanting to start your own fund, this is a great manual of what NOT to do.

Career Advancement Opportunities

March 2024 Investment Banking

  • Jefferies & Company 02 99.4%
  • Goldman Sachs 19 98.8%
  • Harris Williams & Co. (++) 98.3%
  • Lazard Freres 02 97.7%
  • JPMorgan Chase 03 97.1%

Overall Employee Satisfaction

March 2024 Investment Banking

  • Harris Williams & Co. 18 99.4%
  • JPMorgan Chase 10 98.8%
  • Lazard Freres 05 98.3%
  • Morgan Stanley 07 97.7%
  • William Blair 03 97.1%

Professional Growth Opportunities

March 2024 Investment Banking

  • Lazard Freres 01 99.4%
  • Jefferies & Company 02 98.8%
  • Goldman Sachs 17 98.3%
  • Moelis & Company 07 97.7%
  • JPMorgan Chase 05 97.1%

Total Avg Compensation

March 2024 Investment Banking

  • Director/MD (5) $648
  • Vice President (19) $385
  • Associates (86) $261
  • 3rd+ Year Analyst (13) $181
  • Intern/Summer Associate (33) $170
  • 2nd Year Analyst (66) $168
  • 1st Year Analyst (202) $159
  • Intern/Summer Analyst (144) $101
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