This week's report is a continuation of Week 1: Training Week.
Note that I AM a bit further into my internship than these reports come out and things have gotten significantly busier. Details, names, etc. have been scrambled in order to maintain some anonymity. Let me know if any questions. As these reports are a pretty big time investment on my part, I am considering compiling them into an offsite blog so that they can be accessed by a wider audience; I do plan on continuing to post them here though.
Monday & Tuesday
Monday morning finally arrived. I'd heard business casual is the standard in investment banking these days, but I opted for a full charcoal suit, Brooks Brothers non-iron, and a blue tie. It was a rainy summer day so I brought my umbrella along as well as my company issued messenger bag to stow filled with the previous week's training materials to stow away in my cubicle for reference.
Approaching the building, I adeptly timed the retraction of my umbrella and retrieval of my ID badge to enter the building. In my path, first blood: multiple casualties of forgotten badges. I felt a twinge of empathy, but thankfully it subsided as I stepped over the corpses.
The elevator ride was no more pleasant: awkward intern dialogue among seasoned professionals. I chose not to participate, until Will tapped me on my shoulder. "You ready for this!?" he asked. His grin was unsettling.
"Yeah, man." I deflected. Elevator talk sucks. Avoid at all costs.
At last, we arrived on our floor. The entire floor belonged to our group and is overall structured like a donut. The center is composed of walls, storage closets, and the floor restrooms. The actual donut is where the offices and cubicles are. One can walk in a complete circle around the floor, each with sections of cubicles and offices belonging to senior bankers on the far side. Stepping into open territory felt like being a zebra surrounded by hyenas in the open African savannah. All eyes were on the standard intern-issue messenger bag touting freshlings. Before long, Jeb, one of our intern sponsors, was on the scene to lead us to our desks. We were early, he said, and we should take some time to setup our living areas.
On each of our cubicles were a new blackberry and an IT manual for setting up our computers and phones. With plenty to keep me busy, I settled down, unpacked, fired up the PC, and began going through the tech guides.
The rest of the intern class filed in one by one over the next half hour, all in well before our 10:00 AM check-in. I recognized most of the faces from training, and met some new ones. As one of the largest coverage groups at the investment bank, our intern class had 11 in total, mostly pedigreed from well represented schools on Wall Street.
Jensen - Williams - Junior
Abe - Harvard - Junior
Kayla - Princeton - Junior
Chen - Princeton - Junior
Will - MIT - Sophomore
Victor - NYU - Sophomore
Marcus - Howard - Junior
Jake - UVA - Junior
Nick - Yale - Junior
Wendy - U Maryland - Junior
There was a surprising amount of information to go through in setting everything up. I had been forewarned anecdotally by an analyst at the firm to learn how to use the phone as soon as possible for conferencing. Apparently interns are expected to set up calls among bankers and clients, and it is deceptively easy to end up having your voicemail messages broadcasted over the line during these calls - so deceptively easy that it's happened several times before. After abandoning the impossible task of setting up my voicemail box, I set out to activate my blackberry: no problem, IT had already taken care of it. Several others reported differently. My curiosity roused, I went to check that each of my banker applications was functioning. I was unable to access most of them, citing server errors or lacking the proper access permissions. I had a feeling that this was going to come back to bite me in the ass when it came time for staffing.
At last, Phil and Kevin, our senior associate intern sponsors, had arrived. Five minutes after 10, the two seasoned professionals seemed to be accustomed to arriving a bit later into the morning. Phil shook all of our hands while Kevin was immediately bombarded by questions from the inquisitive Will as to why nothing in the vicinity of his cubicle would function properly.
"I'll show you guys how to call IT later. They deal with that shit," Kevin stated as a matter of fact. "Now everyone grab a pen and follow me."
Our leaders took us into the lobby, the elevator, and down to a floor full of conference rooms. As we entered, a concierge was just finishing setting a platter of fruit and biscuits at strategic positions throughout the elongated wooden table.
Upon taking our seats, Phil and Kevin passed out 3" binders filled to the brim with group-specific training materials. The insides covered everything from company profiles to LBO modeling. The preface outlined our group training schedule for the day and the next.
10:00 AM - 12:30 PM: Introduction to group
12:30 PM - 2:00 PM: Lunch
2:00 PM - 4:00 PM: Financial statements
4:00 - 5:00 PM: Company profiles
5:00 PM - 6:00 PM: trading comparables
10:00 AM - 12:00 PM: Operating models
12:00 PM - 1:00 PM: Lunch
1:00 PM - 2:00 PM: DCF
2:00 PM - 3:00 PM: LBO
3:00 PM - 5:00 PM: Overview of industry verticals
The training was mostly repetitive, although you'll notice that each group tends to do things a little differently than the others. My group consisted of multiple industry verticals with its own bankers, trading comparable spreadsheets, and proprietary models. Each one was formatted differently for optimal use. Analysts and associates from the group rotated in and out of the room in an effort to break up the teaching workload. One particular analyst left a very stark impression on the intern class.
Her eyes were droopy, but they weren't always. The spots underneath her eyes were noticeably darkened over the past couple years, and she was about to begin her second year with the firm. "I know you guys are excited about this summer. Just do yourself a favor and make sure you're absolutely certain that this is what you want to do. Okay?" She looked to each of us for a binding nod of the head before beginning. Her name was Marianne, and none of us would forget it.
We were walked step-by-step through trading comparables, DCF, and LBO analysis. At one point, we had an analyst and associate in the room together teaching. The associate was in his second year out of business school, the analyst in his third. The associate adamantly stressed the importance of leaving a comment on every cell containing the source of the information, both PDF page number and actual document page number. The analyst's eyes rolled into the back of his head each time, a message no doubt intended for us. I made an attempt at jotting down discernible steps to spreading comps amidst the analyst and associate's mixed messages. This was in vain as I would later find out.
The associate stopped mid-sentence to check his buzzing Blackberry before getting up and leaving the room without a word.
The analyst - Leo - smirked, "Alright guys. Fuck all that excessive commenting shit. Just keep your sources handy, and make comments when necessary. Associates like analysts do all that shit so they can cover their own asses without doing any work themselves."
Training came to an end Tuesday evening. We were sent back to our desks with homework assignments for each of the lessons with deadlines established throughout the next seven days. After a couple hours of slogging through homework, I remembered my mentor mentioning that nearly anything could be found in the group directory: profiles, models, client decks, resumes, and even photographs of bankers in the group. On that note, I opened up the directory and began familiarizing myself with its organization.
"Anyone wanna do a group order on Seamless with me?" Abe shouted out to our cubicle section. A few of us got up and walked over to his desk to browse through the dining options. Chen made several recommendations to us from her desk, no doubt recommendations that had been made to her by the Princeton alumni in the group. I again wondered how deep school connections ran in the group.
Less than an hour later, about $100 worth of Chinese food had arrived for five of us all charged to the group code. Abe found an empty conference room for us, and we spent the next half hour talking about our schools and the other interns. We all made a pact to stick together throughout the summer and have each other's backs. Nick, a member of the pact, told us how IBD was just a temporary gig for him as his father was the founder of a very prominent company and he intended to take up the throne. I shook my head in self-pity, already wary of IB after seven days of training. Unfortunately nepotism would not play a part in my path to financial freedom.
Back to work. I kept up the good fight on my trading comparables homework for another hour. The homework was straightforward, but the reason why the IB learning curve is so tough began to dawn on me. Getting stuck meant losing time rather quickly, and knowing who to ask and when isn't something that comes to you in the first week on the desk. Rather than risk a bad review for asking dumb questions, I wasted time trying to figure things out for myself. With staffings to be assigned in the morning, I called it an early day and headed home to get a good night's sleep.
My name was the last to be called. I leaned back in my chair anxiously awaiting my fate. Through the window, I could see the other interns dispersed throughout the floor speaking with the junior members of their new teams. At last, Phil called my name and pointed me to a first year analyst. I walked over, fixing my tie and thinking of what I'd say. I decided to play it cool. I leaned against his cubicle wall, read his name tag, and announced myself, "Hey Sam, Phil sent me over here to talk to you about a deal staffing."
Sam looked back over his shoulder, shook my hand, and pointed over to the printers, "There are five copies of this deck coming out. Clip them, grab a chair, and head to Mink's office. Client call in two minutes."
Before I could say anything, his attention was back on his computer screens. I turned around and walked briskly to the printers. As I waited for the print job, I realized that I didn't have any clips. The clock was winding down. I looked to the nearest cubicle: a secretary. I asked her if she had any, and without saying a word she pointed me to the office supply closet. I thanked her. After rummaging through several cabinet drawers, I finally found the clips and noted to myself to spend some time learning where to find the necessities.
My return to the printers was not a welcoming one. Everything was in disarray: the printer had jammed midway through the last copy and Sam had already left for the meeting. I opened up the front compartment, unsure of where to look. Leo spotted me from a few feet away, waiting for his own print job to finish. He laughed mockingly, reached behind the obnoxious machine, and yanked out a tattered sheet of paper half covered in ink. The printer resumed, 30 seconds later I began the search for Mink.
After nearly circling the floor, I spotted Sam and the rest of the team inside Mink's office. They were waiting on me. I scouted the surrounding cubes for a vacant chair. Without another second to spare, I took a chance and grabbed the empty chair from a secretary's desk, probably on her lunch break. Mink instructed his VP to dial the CEO as I passed out the decks.
"Hey Bill, I've got Mark and Patrick on the line with me," Mink stated routinely.
Routinely, I watched Sam raise his eyebrow with resignation.
"Hey Mink, just got the discussion materials from you. Let's flip through them."
Bill's profit margins had been lagging over the past few years and he was looking tomake some strategic moves to bolster revenues or cut expenses. The discussion materials contained five different scenarios consisting of different combinations of acquisition and subsidiary divestitures accompanied by pro forma revenue and EBITDA projections, leverage sensitivities, valuations, and synergy impacts. There were three acquisition targets with varying willingness to sell located around the globe. The targets were family owned and each of them desired to keep significant amounts of equity in their companies post acquisition. Mink had been in contact with one of the families over the past few days and managed to talk them into selling the company outright. His job now was to press Bill into taking one of the scenarios presented and generate fees for the company.
An hour later, I had filled pages with scattered notes in attempt to bring myself up to speed and Bill thanked Mink for the deck saying he'd consult with his CFO and call back in a week or so. Sam was the first one up and out of the room. I followed, returning my chair to the secretary's desk before walking back to Sam's desk.
I asked Sam the questions I had written down during the call and he walked me through the model he'd put together over the past 24 hours and how to toggle each scenario for future reference. Sam gave me access to the directory folder and said he'd let me know if there was anything I could do. I retreated to my desk, caught up with the others on their staffings, and spent the rest of the week getting through the homework assignments, perusing my training materials, and casually meeting other junior members of the group. The summer was off to a pretty slow start as clients went on vacation and junior staff were too busy to stop and explain small assignments to interns. I spent a few more hours on the trading comparables and company profile homework, nitpicking at every little detail to fill the time.
Boredom set in, and I went out for an extended lunch with the pact. After an hour, I decided to check my Blackberry out of desperation for something to do. I'd received an email almost an hour ago concerning a missed call and voicemail from my staffer. The present situation requisite a fast walk back to my desk to avoid appearing M.I.A. to the guy calling the shots on full time offers. He asked me to contact a senior associate - Juan - for further instruction. I looked his name up in the directory and sent him an e-mail pledging my undying allegiance to the cause and availability to meet at his convenience. Hours passed: no response.
My tattered ego only amplified the boredom of just sitting in my cubicle staring at the front pages of various financial news sources for hours on end. At last, a response. The subject line read: "Meet at my desk in 5 minutes." I clicked on it, eager to read the body which would clue me in on all the interesting analysis I'd be doing for him. There was no body.
Armed with a notebook, pen, and the widest smile I could muster, I announced myself to Juan and stood by for his orders. He chose to skip the pleasantries and pulled out a blank sheet of paper.
"Know what a profile is?"
"We had some training on it, yeah."
He drew out two columns each divided into multiple boxes with labels and sample lines.
"Ever heard of this company? Yeah, me neither. Pull up whatever you can and put together a profile using this template."
He slid me the sheet of paper. I made it a point to ask everyone when they'd like their work done.
"Don't spend all night on it. I'm a lifestyle kind of banker."
I spotted an analyst a cubicle over roll her eyes. I chose not to pursue an actual answer. Back at home base, I reached for my training Binder and flipped to the section on company profiles for something to work off of. I found a profile with a similar build to the template and pulled it up on the directory. Like a good banker, I saved it to a new file before doing anything so as to not mess up the original slide. Figuring this would only take an hour, I pulled up the company on FactSet expecting to see all the information I'd need. There was nothing. A bane of a junior banker's existence dawned on me: the private company profile. I flipped a few more pages into the Binder: private company information of varying quality is usually pulled from the website.
The website yielded very little. I jotted down some background information into one of the boxes and spent the better part of an hour picking out products with similar image sizes and short enough names to disperse proportionately throughout the right half of the slide. Formatting was painful, and the only way to improve is to bite the bullet and practice. After some digging through the archives on financial news websites, I discovered that the company had been taken private and sold by a private equity firm to another about a decade ago. Finally, some solid information. The lead took me to a founding date and old financial figures from the brief period the company was publicly traded.
It was nearly 9:00 when I decided to call it and ask for some help on filling out the last box. I formatted everything according to the original profile and pulled up a couple others to double check that it followed the group standard before printing a copy and taking it to Juan.
"Not bad," He paused to make a couple marks, "just make these corrections and you're good to go."
The markups only took a few seconds. I emailed him the final product and gave myself a proper pat on the back for a solid day's work before ordering dinner with the others. By this point, I'd made a mental agreement with myself to stick it out until 9:00 PM whenever I had little to do before taking off.
Thursday & Friday
The last couple days of the week dragged on with very little to do besides a menial research task that took no longer than an hour for my deal team. It seemed to be the luck of the draw this week on staffings as several other interns were hard at work while some of us simply were not needed at the moment by our teams.
Phil comforted us with his words of wisdom and promises of more staffings on Monday. "You guys will learn that this business is all about ebb and flow."
With plenty of time to complete homework and study the training materials, I felt no need to come in over the weekend and spent my free days enjoying the city with friends.
The very talented author of this post, moneymogul, is also the author of our Finance Internship Guide. Want to read more of his stories? Order the guide now for 80 pages of extremely detailed day-by-day reports from an actual bulge bracket investment banking intern.
Mod Note: Throwback Thursday, this was originally posted July 2013