Hearing from sources that Moelis interns had a surprise 5 hour modeling test this week where they had to build a300+ line LBO and make a merger model on the CoreWeave deal, all from scratch. Supposedly the test holds significant weight on return offer decisions. The place has truly become a sweatshop since Ken’s decision to step down.
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Surprise 3 hours LBO model build. Should have used the offer to go to other bank. We already had our hand-spread comps company profile due within a week following the training. I know Houston team gave out LBO models to their interns to practice when given downtime during the first week while taking 8:30 attendance check. Guess they must have been prepared. I’ve been hearing about upcoming merger model but pls dear lord it’s a bs.
Sf only had 2 hours
That’s honestly fucked up
Ridiculous. Any bank or group that does this needs to be checked. It takes even the best bankers time to develop skills, and expecting a college kid to learn that in a month is crazy. Times have changed. Modeling test are not applicable, especially from scratch when we all use templates.
I was hoping this was a troll post..
Can we have a list of firms that do this? Inexcusable. Poor interns. Who wants to grade those anyway?
I heard BofA did a modeling test for their intern class a couple weeks ago, can any confirm?
I heard UBS Tech does this which is ironic all things considered
UBS does this
Can confirm, beleive M&A at UBS does a timed modelling + finance test. They are coincidentally a group that's notorious within UBS for being toxic, working extremely long hours with no deal flow, and all being nerds. Checks out.
Not true
found the staffer
I know some 2nd year analysts who couldn’t build an LBO from scratch. Actually, I don't think the majority of An2s and non-A2A associates at my EB would be able to build one from scratch. "From scratch" being the key thing here.
Only reason I even can is because I worked on a deal with a shit sponsor that couldn't model for their life so I had to do everything from scratch. Was not fun. Otherwise, in my experience, the sponsor usually does the LBO modeling. Though I'm in a buy-side focused role. I guess it would be different for a sell-side focused group.
.
Just to clarify for the interns / college sophomores - 1% of interns can actually do this even close to accurately. The new analysts and MBA associates have little-no LBO modeling experience. Current PE associate
Most senior MDs sat in the printing room their entire internships, now they're asking for timed LBOs lol
Had an MD open up our model once, and we needed to explain basic Excel formulas. Then he told me to stay back after everyone else left to walk him through how to do a sumifs on a team PnL file he was working on...
Is this real? Can anyone confirm?
No, it’s not.
I know people interning there and can confirm it is true, sadly. Apparently it was 3 hours though and only an LBO (no merger model). Still wild
The entire way the post was written is false and totally exaggerated.
wtf is this expectation? The interns I had basically sat in a supply closet pulling comps and did research all summer. I doubt even skilled full-time employees can pull it off in 3-hrs.
Note for all interns: if your firm or group does this, run as fast as you can. Prob not a place you’d want to be.
Why is that? No one said it has to be perfect right? They will just use it to filter a bit, which is advantageous. Wouldnt you want your new analysts, that you will have to work with the next 2-3 years, to be well-prepared with things like this? Should be able to filter the people with actual interest in the topic out, while identifying those binge-learning the question sheets.
Just a question.
Are you sadistic?
Call me dramatic but I think its just so malicious. They know 99% of the interns WILL freak out and are unprepared, they are doing this as sort of like a "We Caught You! You aren't Prepared!" its like they are purposely seeking this out.
It should be done in a collaborative, comfortable learning session. These kids are all hardworking, bright, and want to learn. No need to shove a pressure test down their throat (pause). It should not be a 5 hour test where your future literally depends on it. It spells so much bad vibes and culture. Absurd.
I know I will get smoked with downvotes and called a pussy though!
Is it across all Moelis offices?
Maybe everyone is misinterpreting and they're just getting their interns ready for on-cycle
Every group should have a “test bank” with blank LBO files and related documents to work on in downtime to practice. A firm-wide 5 hour test does not sound like that to me.
Based. They knew HHs reaching to their interns so keeping them prepped
That’s crazy- point of the internship is to learn and be semi-helpful with menial tasks as you are brand new.
At my group, we’d make our interns do modeling for a case study mostly from scratch so they’d learn how the formulas and cash flow logic worked but it’d be over the whole summer when they had downtime and we’d help them out if they needed it. They had to present the case study but never factored into their offers, was just practice for them and to teach them different aspects of the job.
How long until LBO modeling becomes an AI cheese?
Honestly it was highly thoughtful of Moelis to do this. What a wonderful place to work!!!
Why are they saying it needs to be 300 lines? SU / Cap, FCF build (recognize you need a debt schedule) and returns math (which just pulls from your equity that you have on paper anyway)
If it was truly a surprise like here you go and you will fail if you do poorly would be bad but if given some time / reasonable guidance it is a reasonable ask from a bank.
FWIW my interns this year are shockingly bad relative to last few years and pretty concerned about how this will play out (wouldn’t be the first time I’ve seen it play out poorly when a weak class is around).
Still just a job at the end of the day
The main problem here is that it's a timed test. I think most people are fine if interns are assigned models to work with longer timelines for the sake of learning, in fact would guess many interns prefer that.
My attitude towards this is almost 100% a function of whether the kids had notice and a chance to prep.
I think it's perfectly fair in theory to evaluate summers based on a test of stuff they'd do as analysts. That's waaaay more objective than the kind of arbitrary horseshit that gets people dinged in post summer roundtables
But if they had no chance to prep, this isnt useful at all
I'll confirm a few things. This level of LBO depth was never part of the summer analyst interview process (not sure about summer associates). It was barely covered in the pre-training homework and only briefly mentioned during intern training. Historically, we’ve had operating model and DCF tests, both of which were thoroughly taught during training. What is also strange based on what I am hearing is that new LBO-related training materials seemed to appear in the training portal only after the test, almost as if the firm is retroactively trying to claim that sufficient prep resources were provided. Also, very few interns have actually worked on an LBO model - or are likely to during the internship. What I find the most problematic is the rumor going around among bankers and interns that certain people underperformed despite coming from top schools studying non-finance and having less of a finance background - basically creating a narrative of "Jane/Brad goes to Harvard/Duke but look at how they suck at his/her job".
Completely unsurprising given the concentration of IU/Texas hardos who still have a chip on their shoulder about going to a state school
I’m an incoming Moelis intern from a non target and asked some UT buddies - allegedly they felt prepared bc of their Wall Street from mccombs modeling classes while I gotta learn it on my own time. Oh well.
Congrats on Duke
Congrats on Duke, and go Blue Devils
Not saying Duke is Harvard tier, just trying to annonimize here.
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