Common Interview question: If I had to raise 100K, what would the process be?
so theres a common question thats asked in many interviews, that is a little unfamiliar to many candidates. what do you think the answer to this question would be, how would you go about answering it, are they talking about the normal IB method used?
Question: If I had to raise 100 thousand dollars today what would be the process to do so?
Who is "I"? The interviewer? In the capacity as an I-Banker? For a company? Debt or Equity?
Or is he referring to you? 100k for what? A startup?
Such a vague question....
Yeah. A lot of questions to be asking there.
In a markets interview where a friendly dose of snark is permissible, my answer to his vague question would be that he probably has a house with equity in it and he can take out a HELOC or a second mortgage. :D
I would piggy back on this and tell him, should he not have that 100k in equity already, he should take what equity he does have then subscribe to this service my friend has. It's penny stock advice and they routinely get 40000% returns! Its really a can't miss kinda thing
Step 1: Buy Knee pads Step 2: XOXOXOXO Step 3: Profit!
I'd just try to spew out as much stuff as possible about capital raising, keeping my answers very broad and continuing to use assumptions. I think the point of this question is more about seeing your thought process and overall understanding of the industry rather than giving a "correct" answer.
Naturally you'd probably want to start by considering debt v. equity... then I'd probably branch out into specific methodologies beyond that on both sides of the equation.
The correct answer (for you as an individual) is:
1) credit cards 2) friends & family
Unlike a lot of interview questions this one is reasonably legit (to see if you have a basic understanding of finance), so being a smartass will probably not go over well.
1) Call Bank about picking up 100k in Cash 2) Withdraw.
done.
whats so hard about that?
Like a boss.
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