What if I just don't "get it"
Hi all,
As I wind down on my 2-year analyst stint, I've started to think more and more about my transition to PE in the next couple months.
For background, I come from a semi-target, didn't know anything about high finance, and had to work immensely hard and put in a lot of individual effort to get to where I am. I don't consider myself an exceptionally smart person -- I owe everything I've achieved to pure work ethic, but I'm worried that this won't be enough in my new role. I also grew up in a financially-challenged household raised by immigrant parents who barely speak English, and was never really exposed to finance, the markets and the general business world until I went to college as a business major. I feel like I've been catching up to build that fundamental financial knowledge / intuition that so many of my peers already seemed to have.
I'm near the top of my analyst class at my current bank, but I still mostly attribute that to work ethic. In PE I know I'm going to be challenged to take more ownership of my work, have an opinion about my analyses, and carry that investor mindset. While I always try to step back and understand the bigger strategic picture of what I'm working on and be thoughtful with my analyses, I'm worried that I haven't fully developed that intuition or perspective to know what is important when looking at investing in a company, what questions I would ask during due diligence, etc. I want to be able to hit the ground running at my new role, but am concerned that I just won't "get it" as well as my other peers.
Could anyone provide any specific tips for ways I could bridge this gap and better prepare myself for the responsibilities I'll have in PE? What steps did you take as a second year that you think paid major dividends in your new role?
The good and bad news is that nobody in PE / going forward will care about your first paragraph, and will judge you on your merits rather than your situation. Any of your peers that act like they have everything figured out are fronting, and the vast majority are as unsure of the future as you are. Trust me that none of them have intuition or perspective; the best ones have had their head down at a deck/model for 100 hours a week grinding. You get perspective when you can pick your head up and look around at the big picture.
You have exactly the right mindset and are suffering from the classic "imposter's syndrome." Keep your mindset toward continuous learning and it's okay not to ever feel "comfortable" or like you've "made it." At the same time, remember to celebrate success and don't overestimate your peers as if they have everything figured out in life. Very easy mistake to make especially when browsing social media.
The question that will get you the farthest is "why?" Learn and use the "Five Why's" pioneered by Toyota. Make some consulting friends or reconnect with friends from school who have put a couple years into consulting and learn some of their ways of thinking.
Second most important question is "so what?" which goes the other direction of "why." You observe a piece of data or pattern -- so what? This is in the book -- so what? What impact does it have. Ask that question to yourself 50 times when making a deck and you'll be golden.
Seriously, OP - this response is spot on. Do not overestimate your peers or underestimate either your ability or what you have learned.
This (+SB). Op, if there is a way for you to build some confidence outside of work (working out, doing something you like etc), it would be worth your time. Your introspection and humility is not that common in the business and it because very rare at higher levels. Just try not to come off as scared/insecure. You can be very secure in that you don't know much and that there is so much you cannot control.
Believe me, if all of these people knew what they were doing in this business and it was that easy, they'd be retired by now.
Good Luck
I think I get what you are saying
"on't overestimate your peers as if they have everything figured out in life. Very easy mistake to make especially when browsing social media."
But just to be sure, could you please expand on this?
Sure thing! First of all, the part about not overestimating your peers. So let's say you join a megafund PE shop and you're next to Harvard, Stanford, and Wharton grads who were at GS, MS, and JPM. And let's say you came from a slightly more modest background. You look at your peer's resumes and think, "Wow, they must have everything figured out, and a great plan for life."
Let me tell you, most people think they have a "plan" only up until perhaps business school. "The Path" is 2 years Analyst, 2 years PE Associate, and 2 years top MBA. Okay... after that you are 28-30 years old. You have 50+ years left to live and at least 30 of those working. At this point nobody is telling you what to do. A small number of people will do VP PE -- many of these don't really know what else to do since they've put so much of their life into The Path.
Social media sucks because you're comparing other people's highlights to your everyday life. You are looking at a selective trophy case of someone's life, but what are you not seeing? You're not seeing their own insecurities. You're not seeing their own failures. You're not seeing their own struggles. Do not compare how you feel with how someone else looks.
Someone else could have a much better looking highlight reel than you while having a much worse career and life in reality. Read that again. Ponder on this truth. I'm sure you can think of many examples in sports, business, and elsewhere to prove it to yourself.
So, as a result, you are on equal footing with many other people and have plenty of time to get wherever you need to go or are meant to go. Don't compare yourselves to others and use social media as sparingly as possible.
Thank you for the fantastic advice, will definitely keep those questions in mind going forward.
Strong post, as always!
You’ll be fine. This post alone makes me think that you’re thoughtful + self-critical enough to succeed.
Also, outworking everyone works in PE as well, FYI
I think this phrase applies here: "The most knowledgeable people are the ones who know they don't know anything." Trust me, when I say that many people who you think know everything are just not being transparent and are always trying to give the impression that they know what they are doing and are confident about it (Fake it till you make it).
You are near the top of your class and got a PE offer. You have to have at least an above average level of intelligence to get there. At that point, it's not a matter of how smart you are. It's how hard you work and are committed to something. Your hard work ethic will take you far in life like it already has.
Trust me, you'll probably think you don't "get it" when you're a PE Partner either :)
This!
I'd highly recommend Howard Marks' memo "Nobody Knows II" from a couple of months ago.
OP here, thanks for the rec, it was a great read! Crazy to think how much has already changed since that memo was written...
I have a different background, but I can tell you that what you are feeling is not uncommon (despite the fact that some people just ooze cockiness). When I first made VP in ER and got my own coverage I was nervous every single day that I was out of my depth. Even now, every time I send out a report I am just waiting for a client to email me and say “what are you some kind of idiot” while pointing out an obvious mistake. It sucks, but I like to believe that the mentality makes you strive to be better everyday.
It takes decades to develop investment acumen which is why this business is so different from tech where youth is seen an asset/advantage. You build up this acumen every time you look at a new deal and over time you start to see patterns and recurring themes that help you make better decisions. And even then you will still make mistakes. In this business if you have an over 60% hit rate you are a star. Can you imagine an engineer who sees 40% of his bridges collapse? That guy would be out of a job pretty quickly.
Agree with the above. If you're already top bucket and have scored a PE job which involves getting through headhunters and several rounds of interviews, you're entering with the required skillset you need to succeed in your PE job. Don't sweat it too much, they know you're not an astute investor just yet but they hired you for a reason so keep the chin up and continue doing what you're doing.
I'm always astounded by the level of shameless racism/xenophobia in comments like this on WSO.
why does this have to be shameless racism or xenophobia and not a harmless joke (or in your eyes a shitty joke).
I thought it was funny and props to this guy for keeping his comment up after getting so much MS, I don't see why even if you are a diversity candidate that you couldn't find humor in it either. Just don't get how you jumped to racism or xenophobia and got so many bananas for that.
And before you go attacking me I've had a shitty life too and have benefited immensely from others generosity- however, I think it's OK if people find above things funny and NOT jump to calling them a racist or something (like, we don't even know the posters race and if so he even used a diversity program or even that this LBO associate isn't a diversity candidate himself).
Where do you get off to making all these assumptions I don't get (there are a lot of people like you , genuinely curious why you think this way try not to take it personally). Wouldn't it just be better if everyone had thicker skin, could take a joke aimed at them, and have a nice life IDK
Really? At this point, I completely expect it from some bitter kid whos upset that he cant rely on on daddys connections. There was a thread about power couples made a few weeks ago, you should see the misogynistic comments in there about women.
I kind of feel the same going into SA. I go to a target so I never had to live and breathe finance to break in. I always just did what I was supposed to do to get the job. But as a result, I feel like I’m lacking in terms of my knowledge and intuition. I wish I was more of a “hardo” I guess haha
Anyone have tips for becoming more of a hardo inside?
Step 1 ) Listen to Swedish house mafia - Antidote, Astronomia 2K19 radio edit and Axwell - in my mind.
Step 2 ) Adopt top bucket or bust mentality with everything in life.
Step 3 ) Read finance books and materials until you ingest so much that you hate non finance books.
Step 4 ) Base your life's worth on titles, wealth and develop an attraction to long hours.
Step 5 ) Learn how to sit still and work on excel and ppt for 14+ hours. When you sleep, dream about financial modelling and how you're going to dominate PE recruiting.
Step 6 ) Use WSO to confirm that going to an EB makes you a demi god and DB isn't a BB.
Step 7 ) Realize that if you don't develop a bit of hardo streak in you, you will have bottom tier exit opps that will influence your decisions in life. You will cuck yourself from dating a top tier woman or man and become a risk averse bitch that can't accumulate FU money because you've cucked yourself from going to Apollo or KKR.
Step 8 ) If you don't want to do any of that, date someone from stern and let them suck the soul out of you in exchange for the hardo potion.
Ahhh...nevermind.
It’s all a house of cards OP, and everyone is just taking educated guesses at best.
following
I have a pretty similar background to you (semi-target, wasn't even a business major, top bucket, etc.) and I started my role an UMM last year.
I didn't think the learning curve was as steep as people made it out to be. I thought being a 1st year in banking was more stressful since I was learning to model as well as how to be a professional (appropriate email responses, pushing back, handling multiple projects, etc.). I think the biggest differences in my current role are being confident in expressing thoughts and being more thoughtful about the work itself. In terms of modeling, it's a bit more technical but I'm sure the group will have old models for you to build off of. In terms of reading CIMs and making investment decisions, it'll be pretty group specific to what your seniors like in terms of a playbook and industry / company factors and I'm sure you can pick it up. Everything else is just reps since it's a lot of process - working with lawyers / legal docs, QofEs / accountants, etc. I don't think most people in the industry are crazy smart or anything, they've just gone through a lot of reps and put in some effort.
As a 2nd year, I tried to speak up more. Not in your control, but I was on a project where I was deployed consulting-style to the client site for 2 months and had to speak with the CFO and CEO pretty much everyday. I think this helped me realize there are a lot of areas where you can add value even if you're only a few years out of college.
Good luck with your role. Don't stress too much. It's easy to look at VPs and higher and think that you aren't as competent, but they've just had more reps.
It truly is all about the reps at any level. I always wondered how my VPs knew so much about an industry that they were able to write the best points in succinct bullets and could draw out coherent and thoughtful slides. After working with them on several things (primers and CIMs), I realized they have a way of thinking through things and it became almost like pattern recognition where I could also start to tell what slides they would want to add to the deck.
One more important thing that took me a while to realize (in terms of how they are so in tune with the industry) was that these VPs are actually on a lot of calls or meetings with clients / companies in the industry we cover. They're constantly exposed to new ideas while also hearing the same important points over and over again. This makes things much easier for them to know what exactly are the key points to emphasize in a deck for a specific company. As analysts or even associates, we don't really get that constant exposure with industry veterans. Once you actually get to the point of attending these meetings, you'll start to feel like you "get it" more and more.
no advice but the work ethic
bump
Get a piece of paper and write a couple of goals in various domains; - Career - Self development - Relationships - Fun/adventure/sports - Contribution to community, etc.
Work on all of them at once and realize that life is not about work only. Work is important, especially if you're hungry and competitive and ambitious as most people on here. But it's not everything. Moreover, a lot of luck is involved---more than any successful person would ever acknowledge. As you get more succesful in other areas, you will become more confident because of who you are as a human being. Not because of some title, not because of how much money you make, not because of the shoes you wear. You will get more confident because of you. You will then go to work and see those suckers bragging about xyz and you will feel sorry for them. You will feel sorry for them because they just don't get it. They simply don't understand life.
PS: if you care about a goal in life, a mission that supercedes your own being, then you won't care that much about meaningless stuff
dont worry i failed my series exams twice in a row before passing with a 71% - im more qualified to deliver milk in the 1920s
When dealing with complex situations I think it is important to just focus on the first step. The adage '90% of life is just showing up' comes to mind.
They already sent you an offer (it seems), so they believe in you - all you have to do is show up.
I am an endurance athlete and think of certain races or training days as just showing up. I ran twice today (two 5mi sessions so far - I might do a third later). For my first session I thought - hmmm I could sleep more or run now, so I showed up to the run. I ran. For the second session, I thought - just get to the starting point and 'see what happens'.
I think that is a good attitude to bring forth in life. Just show up and see what happens. Presumably you have the skillset to perform - so that's what you will do. It should come easy and naturally for you and if it doesn't - fuck that path - just choose another. That's life. You go down one path for a little bit and if you like it, you stay.
I did an Ironman event at elevation in Colorado last year and was pretty nervous about my preparedness and ability to execute the race. But, I thought - you know what - I'll just show up to the start line and see what happens. If I race well or DNF, well, time will tell - but just make it to the start line and give it your best.
Cheers -
Throwing MS without commenting is the life of a coward.
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Read up on the Dunning-Kruger Effect. You are likely in a better situation than most of your colleagues. I've been in a four person meeting where we were discussing how we were deploying a billion dollars in assets, and how best to deploy the next quarter billion. There were 22 post-grad letters sitting at that table, and we all admitted that we didn't really know.
A handful of unrelated tips in no particular order:
You're placing too much pressure on yourself to have it all figured out Day 1, which is not the expectation that your seniors have for you. The most instructive thing I ever heard during my time in PE was a year into an analyst stint when the Managing Partner said to me "I didn't expect you to know anything". All he wanted was for me to be curious, learn, and do the work that was asked of me. Once you remove your own self-imposed (and not realistic) standards, you'll enjoy the work and perform better.
Beyond my initial point, careers are not about getting to a point of "having it all figured out." The point is to show up every day with an open and curious mind that will allow you to learn more, have your perspective challenged, and continue to develop. The people that "have it figured out" are stagnant, arrogant, stop learning, and eventually become irrelevant. Continuing to succeed requires having the right PROCESS, and not an excessive focus on OUTCOMES. Prioritizing curiosity and learning ensures that you will have a good process for your career that will serve you for decades to come.
The "investor mindset" that you're seeking takes years to develop. It's unrealistic to expect that you have the insight of a well-seasoned deal professional at this point in your career. All you can do is focus on what can make YOU a better investor through your daily experience. Your peers are irrelevant for two reasons: 1) you cannot have the same experience they have, and 2) they're probably faking it anyways. True wisdom in the investment world can only come from experience. You can read all the books in the world, but to truly grow, you need to do the work, make the mistakes, and learn from them.
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