I still cannot construct a model from scratch after 5 years (4-year degree + 3 internships across ER, IB & AM). Seriously wondering if I should get tested for brain damage or severe learning issues?
Title.
I have worked 3 different internships in mid-high finance and yet I still cannot construct a proper financial model on PLCs from scratch. I have watched countless tutorial videos and also referred to actual models made by sell-side brokers.
But I still cannot figure out how to forecast cash flows properly, can (barely) construct a 3-statement model without referring a lot to online resources, DCF is still fine. Need to be handheld by friends in PE to construct a LBO with complete debt schedule.
In essence, I can make a one-page valuation model and that's it. Anything beyond 1-2 Excel sheet and I am stuck. smh
Can someone please point me in the right direction? Thank you. I envy those who can pump out models with the different color-coded cells (rainbow) and hundreds of rows of numbers. Yet I cannot do that despite putting in my best effort and time to figure out things.
My only strength is pitching stocks and writing investment thesis or making wild macro calls but these type of shit is something even high-schoolers can do. It is NOTHING special at all
EDIT: I do not wish to go into roles with less emphasis on modelling such as DCM/ECM/S&T macro so I am trying my best to improve.
learn accounting dude. Fundamentally that is what underpins understanding of a financial model. go back to debits and credits if you really have to. Better to have a strong foundation and understand things from first principle than be able to the 'rocket science' models. Fwiw some of the best bankers i've worked with are ex-CPAs, etc.
when you say learn accounting, do you mean taking a few courses or doing an entire program in accounting. thanks man
Get a PhD in accounting and only then will you have touched the tip of the iceberg.
What specifically do you struggle with? Is it excel? Forecasting? Understanding how X affects Y?
Who cares? As long as you understand the output it's not necessary, especially with AI
Whose your daddy?
Crazy you have a/obtained prior jobs considering this post
Or not crazy b/c 60% of the front office is nepo
20% DEI
and the balance non-nepo
Practice more and study harder
When I look at a completed model I don't have much problems understanding or building a similar one but I really struggle when I have to do it completely from scratch...granted I'm less than a year in at my current job, any advices too? Agreed with the comment above citing to improve in accounting, apart from that what else
"watched" "referred to".
No indication of hands-on practice here. Which is the most important bit.
It sounds like you simply don't know how to learn.
If I'm wrong then the other explanation is you don't know how to ask questions, you haven't really specified what you actually struggle with.
Thank you for pointing that out. I think what I struggle with mostly is coming up with the relevant assumptions for my model. And I tend to get overwhelmed with information when I read ER reports and can't come up with my own due to a lack of understanding of the company. I can do the simple DCFs just fine but I am trying to model from scratch by using the full-fledged models from sell-side analysts as my reference.
Beatae ea dolorum animi dolorem dignissimos. Sed quam hic et inventore.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...