Oppenheimer SF Tech Group - Excel Modeling Test

If you make it to round 2 or beyond of the Oppenheimer SF Tech Group interviews for full-time, you will be given a 1 hour Microsoft Excel Modeling Test. Here is what you should expect and should be able to do in 1 hour.

1) Income statement: You will be given information about a SaaS company and it's historical revenues and future revenue growth. Additionally, you will be given their gross margin percentages, and multiple operating expenses such as sales & marketing, depreciation, and stock-based compensation. These will be given as percentages of revenue, and they may throw in an element to throw you off, such as sales & marketing is expected to decline 25% of the change in revenue. Just be sure to read the question carefully so you catch these tricks. From there you will asked to create a 5-year forecasted income statement model based on the given assumptions and financial inputs.

2) Valuation: You will be asked to calculate free cash flow and WACC and calculate enterprise value in a DCF. They will likely also throw in some information to try and make you get confused, so be sure to read the question carefully.

3) Contextualization: Based on the financial model and income statement projections, as well as the DCF valuation, you will be asked to write a short paragraph describing the business, what stage of growth it's in, and to contextualize the valuation and financials and describe why it makes sense. (example: EBITDA is negative for the first 2 years because they are keeping sales & marketing expenses high to grow fast and find product market fit).

In summary, have some background knowledge or experience on software businesses and how to model a SaaS company, and be comfortable and knowledgeable on the financial statements of SaaS businesses. Watch YouTube videos to help explain topics. Totally do-able. Just prepare. You got it.