Currently a sophomore interning at a local boutique in their M&A group staffed on a sell-side M&A deal. TBH not really doing anything related to modeling or valuation, but I understand the premise of the deal. I have put it on my resume under "Selected Transaction Experience" but will an interviewer grill me on the deal/ what should I understand prior to interviewing?
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So what do you actually do all day?
Making buyer lists/Managing the firm’s CRM for a deal? - That’s deal sourcing
Help making a page in a board deck or management presentation or CIM? - You helped develop marketing materials
Been asked to find public comps/precedent transactions? Even if you didn’t beep boop the metrics into the excel football field yourself? - That’s valuation analysis
If you only do admin work like circulating notes...good luck Charlie. I wouldn’t expect any intern to do more on a deal than the above anyway, diligence heavy lifting and more complex valuation analyses are always handled by the analysts because it’s their job - not because they think you can’t handle it or whatever
So far, I've developed marketing materials by conducting industry research for a CIM and also pulled comps. I'm pretty confident in being able to speak about these aspects of what I am doing but interested in knowing what will an interviewer ask about the deal itself.
For example, would they want to know the different valuation multiples we used for EBITDA even though I wasn't the one conducting the valuation analysis? Or are they going to want to know the general premise of the deal like industry and strategic vs. sponsor buyer etc.?
I had a very similar experience having had Boutique M&A experience my freshman and sophomore summers before recruiting for BB SA. I won’t spend much time telling you how to spin some of your work experience because one of the earlier posters hit this on the head. I’ll focus on what you should be prepared to know. Most importantly, you should know the investment merits of the company. You can rip this off from your “Investment Highlights” page of the CIM. You must know WHY it was a company worth buying. Next, I would have a strong understanding of the auction process (broad [most likely in the LMM, targeted, or negotiated sale) and the types of buyers you reached out to (Strategic and/or Sponsors). Next, have a general idea of the valuation. If you have LOIs or IOIs in already, just go off of that general range, and know what their EBITDA is and the multiple. I might also suggest that you have 2-3 public comps loaded and ready to go. Next, I would either be prepared to talk about some risks/negatives of this company OR, even better, talk about some hiccups you guys faced with buyers having concerns while actually running the deal, likely in the Due Diligence phase, or maybe somewhere in management meetings or marketing. Finally, I would know why the owners are actually selling the business. The rationale is always important. And of course, talk about where you actually contributed.
During my experience of recruiting for Junior SA positions at big firms with two summers of Boutique IB experience, I found the depth I could be asked on my deals varied widely. When interviewing in a lot of generalist processes (as in you have another interview for groups after getting the broad SA offer), they didn’t really care too much about my deals and either didn’t take them too seriously or just kind of thought they were “cute” and asked my really high level questions on them. On the other hand, when interviewing with satellite offices with BBs or more informal processes, people would grill me hard. They wanted to know valuation, they wanted to know financing packages, they wanted to know the # of Teasers we sent out, etc. It never hurts to be fully prepared.
If you haven’t already, I would HIGHLY recommend that you go read The Sell-Side M&A chapter of Investment Banking by Rosenbaum and Pearl. This will ensure that your descriptions of your experiences actually line up with what industry standards are. You can find this on PDF. Thx
Coming from an interviewer I am very suspicious of a sophomore intern with "deal experience" unless your internship is 6-12 months+, and would push a lot more on technicals and the deal structure.
I personally think a deal where you are pulling research and comps is a high risk, low return thing for your resume. You're just inviting questions about valuation and modeling that an intern would not know, as well as harder technicals. Bring the deal up as an answer or highlight it in your intro so you mention it but don't invite questions.
If you end up putting it on your resume, be prepared to answer detailed strategic questions (why this deal? Synergies, strategic rationale, what type of auction process?) as well as valuation (multiples, synergies, projection and modeling assumptions), PF metrics, and what your role specifically was.
Thank very much for the detailed response. Is there another way that you think I should highlight this experience on my resume?
I know that pulling research and comps is not unique but being exposed to the deal process and understanding the different metrics of a deal was very interesting. I understand the overall strategic rationale of the purchase but less so of the valuation multiples, synergies and assumptions. My analyst also briefly walked me through his DCF model so I have some grasp. Any advice?
Certainly a fair point. I would say now, however, having sat across the table as an interviewer too now, I would say that a deal that you got pretty involved in has a high reward if you can eloquently talk about it. For the offers that I won during my Junior SA recruiting experience, they were certainly on the basis of me being able to have a strong dialogue and Q&A about the deals. I actually hoped that my interviewers would dig hard on them because I knew if asked, I would be very prepared. I will say, however, to add onto your post and focus on the OP, if you weren't super involved, it does carry a lot of risk if you are unable to talk about it well. I, personally, had a lot of responsibility on my sophomore deals which made it easier to sell to an interviewer. Some recommendations I might make are to ask for work and ask questions with the end goal in mind: selling this to a Junior-Summer interviewer. This sounds selfish, but every time we made a particular maneuver or reached a milestone on a sell-side process, I directly asked the senior bankers questions I thought I might be asked in an interview eventually. This proved to be very helpful, and they were generally very willing to talk about it. I would also encourage you to sit in on calls, if possible, with prospective buyers during the auction process or diligence process. The questions buyers ask often were the same ones, from a more generalized perspective of course, that interviewers asked.
what are some of the questions you asked and that we should be ready for?
Thank you for your message. could i ask a follow-up? I am in a similar situation, did freshman summer 4 months IB, and I was doing a lot of CIM and sourcing work. I do not have selected transaction experience but my bullet points talk about what I did (think created teaser for 100mm sell-side deal). Is this fine? What would you advise not to get grilled for junior interviews?
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