How Will I f****** add Value?

Just had a 2nd round interview with a boutique specializing in renewable energy project finance. The MD asked me as to what value will I bring to the firm?
I replied that Energy Investment Banking sector requires engineering expertise and also financial skills; therefore I believe that I will bring a unique skill-set to the table and add lots of value( have both degrees). The combination of engineering and financial skills will enable me to understand the structuring and financing and to also help me in determining the risk. But he blasted me by saying that I hadn't done my homework and asked me if I ever looked at their website. His point was that almost everybody at his firm had an engineering degree.
I could not say a word then. However the interview ended after a couple more questions and he wants me to get back to him at a different time. He might ask this dreaded question again. Please advise.

 

if the question was "what value will I bring to the firm"? I think your answer was fine. He did not say unique value, he said value...the fact that they have hired so many engineers points to the fact that he recognizes the exact point you were making.

You were probably just not polished / confident enough so he wanted to make you shit your pants.

without being there that is my guess, Patrick

 

If he asks you again try breaking your response into three parts. Part one should be a past experience that will add value. Part two should be when you start working as an analyst the tasks you do will free up time for senior bankers. Part three mention something long term like you yourself wanting to be a managing director. It’s not so much how you will add value, but more along the lines of the ROI the firm can get from you.

 

General question but I dont know if telling him you want to be an MD in the long term is a good idea. I could be wrong but anyone have insight?

If I had asked people what they wanted, they would have said faster horses - Henry Ford
 
dUcK:
he has no business blasting you in an interview, he's not your coach, he's an interviewer. Forget this place, even if they want you back. If he can't rein in his attitude during an interview he must be an unbearable person to work for.

Haha.I know..but as of now i do not have a choice..

 

These guys want to hear how you will further the core mission or some other bullshit like that. best to ask him what he values and just regurgitate it. Usually these guys have an answer in their head and if you don't guess it. Bogus question if you ask me.

 

Come up with new trading ideas, find arbitrage, back test models so the traders dont have to, what it boils down to is it is different at every desk. One desk might need x while another at the same bank needs y. I can promise you that you arent adding value by being on WSO.

Follow the shit your fellow monkeys say @shitWSOsays Life is hard, it's even harder when you're stupid - John Wayne
 

I'm in a very similar situation and would like to hear people's thoughts as well. Especially on the topic of ensuring this summer's unstructured internship still improves one's financial/market education in the case where there is no offer back.

 

I am an Oil & Gas trading analyst intern as well. Start to build your own models even if they do not ask you to. In oil and gas there are so many different data sources out there and what you can do if you do not already do this is take said data source (EIA reports or Baker Hughes rig counts, etc) and create a model that automates the process of collecting and distributing the info to the trading floor, with added insights from you. You can do this multiple times a week if the data is frequent enough. This is how my internship is set up. each intern is in charge of a hand full of models and create reports for the trading floor on a daily basis.

 
Ibsoup:

I am an Oil & Gas trading analyst intern as well. Start to build your own models even if they do not ask you to. In oil and gas there are so many different data sources out there and what you can do if you do not already do this is take said data source (EIA reports or Baker Hughes rig counts, etc) and create a model that automates the process of collecting and distributing the info to the trading floor, with added insights from you. You can do this multiple times a week if the data is frequent enough. This is how my internship is set up. each intern is in charge of a hand full of models and create reports for the trading floor on a daily basis.

I am in a very similar role, albeit I am also currently studying for the series 3. What are you modeling in, and how did you learn to create those models? I am only a rising junior, so I have yet to take an "finance" courses through my biz school curriculum (where I assume I will learn modeling).

 

GMAT and CFA aren't exactly substitutes. GMAT takes 1-2 months to study for. CFA takes 3-4 months per level.

While the CFA is the course in and of itself, the GMAT is just one piece of a very large puzzle that may one day allow you to attend business school. If you have a chance to, doing both won't hurt (especially since you're bored stiff "watching paint dry".

 

How much substance would punching out level one hold compared to showing solely my sheer finance knowledge and modelling skills?

Its really an 80/20 split for the love towards the CFA on here. The majority of people on here say its a waste of time, I rather spend the time networking, etc, but the 20% who speak of the CFA in a positive light actually have a lot of good stuff to say on it. I'd love to hear some info/experiences from getting jobs after finishing level one (If any CFA monkeys come across this post)

I know the benefits of business school (They definitely outweigh the CFA without a doubt), its just the cost that drives me up the wall.

More importantly, I would love to hear some breaking into boutiques experiences from yall

 
Best Response

You can't "show" modelling skills on a resume. CFA Level I speaks to some level of interest and basic aptitude.

As for the B-School/CFA debate - it's as old as the sun. CFA is a basic requirement to work anywhere in equity research or investment management. It's pointless for IB/PE. It can be argued that even for ER and IM, having an MBA business schools">M7 school is still superior, but many contend that the CFA is better than some lower-ranked schools, especially in those two industries.

Either way, if you're doing nothing but watching paint dry, you may as well do it if you're hoping to get into ER.

P.S. I am what you'd call a "CFA monkey" and I absolutely enjoyed the program. I'll be writing Level III in June and I can tell you that have the first two levels went a long way in helping me to secure my current position.

 

In your original post you say that your lack of modelling skills is holding you back, so I fail to see how obtaining the CFA will address this? The CFA will not teach you how to model, if it did all trainee investment bankers would be required to take it.

If you want to learn modelling I would buy the (BIWS) Breaking Into Wall Street course. I bought it a few years back and it is an excellent course.

A) How long will it take you to learn to build models? Well that depends on your knowedge of accounts and how dedicated you are to following through the material. I would say after a few months you should have a solid grasp of modelling. If you devote 1 hour a day to the videos you will learn a lot.

B) What models should you learn? Depends on what you want to do. For equity/fixed income research projecting financial statements and valuation models are a must.

C) How can you convey this knowledge? Develope a good model and send it along with your CV/cover letter to the botiques that you target. I had a model DCF on Microsoft I used and it landed me my first summer job. Most, if not all, shops will have their own model template anyway so just showing them that you are capable using excel should be enough.

Finally, everyone talks about the networking benefits of an MBA. Don't forget that fellow charterholders also have their own networks and will appreciate and understand all the hours and sacrifices needed to obtain the CFA. It is also has its networking advantages.

 

Sovjet and Ovechkin, thanks for your detailed replys. A lot of food for thought in both of them and I really appreciate this.

I know you guys can't make decisions for me but if you were in my shoes would you start reaching out to boutiques now to try and land a job or wait until CFAs done with in June and I build some solid models to showcase ??

 

Here is a helpful list that will give you the edge if you have no absolutley no back ground in finance. Investment Banking Explained: An Insider's Guide to the Industry by Michel Fleuriet Understanding Financial Statements (9th Edition) by Aileen Ormiston, Lyn M. Fraser Understanding the Corporate Annual Report: Nuts, Bolts and a Few Loose Screws by Lyn M. Fraser, Aileen Ormiston Financial Statements: A Step-by-Step Guide to Understanding and Creating Financial Reports by Thomas R. Ittelson Investment Banking: Valuation, Leveraged Buyouts, and Mergers and Acquisitions (Wiley Desktop Editions) by Joshua Rosenbaum, Joshua Pearl, Joseph R. Perella Financial Statement Analysis: A Practitioner's Guide (Wiley Desktop Editions) by Martin S. Fridson CFA, Fernando Alvarez

 

We have multiple mandates. We co-manage a multi-billion fixed income IG mutual fund with another manager. We also manage a hedge fund that utilizes hy/distressed debt, paired trading, credit derivatives, etc.

]
 

Regarding downtime, so I'll be looking for trends? What program would you use to do that. Excel? Bloomberg? Matlab?

On what I should see: I feel that as I know very little about the practicalities of trading, a lot will seem as it could be easier but it would still be useful to know what I might be looking for in the first place.

 

The recruiters will know that the Freshman year offers very little, if anything, in the way of Finance-related technical skills. That said, I would assume that they'll be looking to see what soft skills you have to offer, which are especially important in the PWM field. We may not answer that question directly on your behalf, but you can do the following, for starters.

Take some time to reflect on how the Freshman year has helped shape you, knowing that the high school-university transition is often a daunting one for many people. Other questions you might want to consider: how do you handle failure/success? How do you handle yourself in stressful situations? What's your opinion on the market today and its outlook for the next (n) periods? How well can you convey complex information to a group of relatively uninformed people (think about coursework, explaining topics to your friends, etc...)? How would you allocate a young entrepreneur's funds differently than you would a retired couple's, if at all (think developed/emerging market equities, bonds, alternative investments, cash, real estate, etc...)?

It really boils down to how well you can prepare yourself to help people manage their own money. And, with a bit of self-reflection, I'm sure that you'll come up with some good qualities to talk about.

 

Best way to add value at the associate level is by having a very good understanding of the companies you follow, and being able to provide new ideas that are both insightful and creative.

This is difficult to do in the position you're in because there is absolutely no way you can get caught up on the companies they follow in anywhere near as much depth as the analysts are, and attemping to offer new ideas about their own companies could be recieved poorly if they don't like the ideas.

You'd obviously want to structure how you present yourself around what they're looking for. For instance, talk about how you're interested in their industries (and actually read up on their industries as much as you can) and are a quick learner (if this is true). Since it seems like they're pressed for time you want to talk about how you can handle some of the workload early on (such as the writing), freeing them up to focus on clients and industry research.

 

On the Sell Side Research desk: Step 1, be good at data entry, because you can't write as well as a guy with 12 years experience. Step 2, be good at making charts, graphs and graphics, if the guy uses waterfalls, become an expert. Step 3, realize that your value add is to give them more time with clients, they get paid when they are not in the model or writing comments, if you spend 3 hours doing something but it saves them 15 minutes, the dollar value works out.

 

Agree strongly with #3 as a sell-side research intern (MBA level) that writes for reports and models.

overpaid_overworked:
On the Sell Side Research desk: Step 1, be good at data entry, because you can't write as well as a guy with 12 years experience. Step 2, be good at making charts, graphs and graphics, if the guy uses waterfalls, become an expert. Step 3, realize that your value add is to give them more time with clients, they get paid when they are not in the model or writing comments, if you spend 3 hours doing something but it saves them 15 minutes, the dollar value works out.
- V
 

I would look to see what kind of data the analysts include in their reports that are not financial figures from the company.

Maybe you can help them with channel checks or collecting data from outside sources ( Maybe you can find new data sources that would help them in refining their models

I remember for one project I had to go through the separate Army / Navy / Airforce budgets going back a decade and pulling specific funding requests for different line items. Incredibly tedious, hard to actually find the right docs on the .mil sites, but would've been a great job for an intern.

 

AFAIK it's basically a "what's unique about you" question. You have to know your strengths and abilities and how you can leverage that to help the team. So for me, I come from a relatively unique background (sophomore in petroleum engineering, will be interning for a large oil company before applying to IBD internships) so I'm planning to apply to Energy IBD, and I would answer the question by talking about my depth of knowledge about that specific industry. Is my finance knowledge on par with an ivy finance major? Of course not. That's not what I bring to the team.

Obviously my situation is probably different than yours, that's just the example I can come up with about myself. You just want to figure out what you can spin to the same purpose. Why you over [similar candidate with maybe better stats].

 

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