WSO Podcast | E116: CIO at Private Equity Infrastructure Fund
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In this episode, Stephanie shares her winding path over her almost 20 years in finance. From getting a ton of responsibility early in her career for internal M&A at a Big 4 to her pivot into investment banking in DCM, she always seemed to find her way to rapid promotions and managing large teams. Learn what she feels set her apart and how you might be able to emulate some of that magic.
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WSO Podcast (Episode 116) Transcript:
Patrick (CEO of WSO): [00:00:06] Hello and welcome. I'm Patrick Curtis, your host and chief monkey, and this is the Wall Street Oasis podcast. Join me as I talk to some of the community's most successful and inspirational members to gain valuable insight into different career paths and life in general. Let's get to it. In this episode, Stephanie shares her winding path over her almost 20 years in finance from getting a ton of responsibility early in her career for internal M&A at a big four to her pivot into investment banking and DCM. She always seemed to find her way to rapid promotions and managing large teams, learn what she feels, set her apart and how you might be able to emulate some of that magic. Enjoy. All right, Stephanie, thanks so much for joining the Wall Street Voices podcast.
Stephanie: [00:01:00] Absolutely. Glad to be here. Thanks for having
Patrick (CEO of WSO): [00:01:02] Me. So it'd be awesome if you could just give the listeners a short summary of your bio.
Stephanie [00:01:06] Sure, absolutely. So I graduated a long time ago when the dinosaurs roamed the Earth from undergrad.
Patrick (CEO of WSO): [00:01:14] You're only a year ahead of me. Don't make me feel old.
Stephanie: [00:01:18] Ok, well, that's good to know. So you have a triceratops. I had T. Rex. Yeah, so graduated from undergrad. Didn't really know what I wanted to do. Took a internal consulting job for a large Fortune 500 company at the time. I did that for a year realized I needed to understand finance more than I did. So I went back for my MBA, really didn't know what I wanted to do after that. But Wall Street sounded fun. Ended up working on a major restructuring. One of the largest ones at the time that had ever been done during my internship took a full time offer with that fund, or that firm stayed there for a few years on M&A, both for clients and then moved internal to our internal M&A team. So more corporate development did that for a few years really realized that I was missing half of the balance sheet. So most of what we did was equity or cash in terms of deals moved into debt capital markets. At the time, I guess it was two thousand seven, two thousand eight. So we were in the financial crisis and really got into commodity finance and infrastructure. And that's where I've spent the last 10, 12 years, did some time with some French banks loved that, moved on to Brazil for about a year and a half, spent some time commuting and then was down there.
Stephanie: [00:02:38] Full time ended up being hired back to a consulting firm. A big four in the corporate finance group moved back to the US, built out a private placement team for infrastructure, then moved over to India for a few years to restructure. That particular firm came back to the U.S. in 2014 and helped build out corporate finance in that particular firm. We took it from about 15 people to over one hundred in the course of two years, and our private placement team globally ended up running global M&A and bounce. And then, about a year ago, partnered with somebody I had known for some time and started kind of thinking about a private equity fund wasn't really sure what the next step looked like, but we've done a significant number of deals in the last four, four or five months and so left in January from the sell side and moved to the buy side as the CIO for this fund.
Patrick (CEO of WSO): [00:03:43] Congrats.
Stephanie: [00:03:44] It's a big year. It's been kind of a ride.
Patrick (CEO of WSO): [00:03:46] Yeah, and it's kind of interesting the timing with everything.
Stephanie: [00:03:50] So I will tell all listeners, watch your career. So my career, typically right when I move, is when a recession starts. So the next time I LinkedIn profile says I'm changing my job, sell everything.
Patrick (CEO of WSO): [00:04:03] It's like you graduated right at the right during the recession. Oh, one, right?
Stephanie: [00:04:08] Right, exactly.
Patrick (CEO of WSO): [00:04:10] So let's start all the way back there and what we'll try to go through quickly because you've had had some really interesting kind of transitions and shifts throughout the way. But like, tell me a little bit about just undergrad background where you always like you majored in like business marketing. But was that always like was finance on the radar? How? What got you interested in that?
Stephanie: [00:04:29] Even so, finance, that's interesting. So no finance was absolutely not on the radar. Finance was my half to get my business degree. I loved marketing. I loved the idea of being creative and didn't really see finance as a creative job. So was a marketing and entrepreneurship. A major political science minor. I was a division one athlete for all four years, so had a lot of time in the pool. I was a diver and really didn't know.
Patrick (CEO of WSO): [00:05:01] I don't know how people do that. I always actually,
Stephanie: [00:05:04] Yeah, I'm terrified of heights. It was a terrible choice.
Patrick (CEO of WSO): [00:05:09] Oh man, I just always freak out. Like, if I, well, number one, I don't have the flexibility. I'd probably hurt, right? Injured myself in so many different ways. Diving off okay go ahead.
Stephanie: [00:05:18] So, yeah, so did that for the four years. You know, and when I graduated, it wasn't. I didn't have a clear vision of what I wanted to be. I thought maybe at some point by the time I was 50, I wanted to be a CEO, but I was kind of it. I mean, I didn't really know what that looked like.
Patrick (CEO of WSO): [00:05:35] What about your parents? No guidance, no like go in this direction or
Stephanie: [00:05:39] So my mother is a psychologist, a clinical psychologist. My father actually started what is now a Fortune 500 company in nineteen eighty two. He IPO it when he was 30 and. Enjoyed 20 years in the Caribbean on a rum plantation and now owns a vineyard in upstate New York, so his guidance was find something where you can drink a lot. His guidance was really find what you love and whatever it is that you love will make you happy and make you money in the long run. So, you know, I didn't, I didn't really know. So I had a job offer my senior year to go internal with a Fortune 500 company. It was really an internal training program and you could spend some period of time out in the field and then at
Patrick (CEO of WSO): [00:06:31] The five six month. How did you even land that? Like, was that was that like what was that like an internship or something like that that went into a full time offer, like your junior, your summer? What did you do in the summers of just train for like diving?
Stephanie: [00:06:45] I just, yeah, so I trained and I coached, so I coached. We had a. We had a like a training program for kids at our university, so it was the camp counselor for diving. And then I spent my summer training also.
Patrick (CEO of WSO): [00:07:00] So I don't know how familiar you are with Wall Street, Oasis and the term Harteau and all these people who are like gunning now for like freshman summer internships in the perfect place and how crazy it's gotten.
Stephanie: [00:07:10] And I have recruited some of them. Yeah. So like, you know, it's interesting. I get it. I totally get it because you're in this competition for the perfect job. But the reality is, you know, spending college to find kind of what you love and really explore the world. That's the one time you get to do it. So it was always interesting. On campus, I would go back to campus every year and recruit. I always had the conversation. I've always had the conversations with the kids who had taken time to go overseas and do something different was always much more interesting. But if you have a great internship, try to find something else to do during the summer so that you have
Patrick (CEO of WSO): [00:07:51] Something else to top. Something unique. Yeah, something unique there. A guest I recently had, you kept saying just being unique. He was. He was from France, came and got us. He had already had a master's, got another MBA at Stern, and that helped him propel like people were like, Oh, this guy's interesting. Different. So, yeah, that can definitely help. So, OK, so you're kind of just, you know, apply through the career center. You're not like going crazy networking. You're really focused on your sport perfecting that. And so a lot of time goes there. You get this job at this large company as kind of a trainee executive trainee, whatever they want to call it. And you quickly realize you didn't have like the skill set or what happened and why MBA and all that.
Stephanie: [00:08:37] Yeah. So it's a great question. We went, so they changed the training program. I was an executive training program where you spent some period of time in the field and then you came back to corporate headquarters and whatever role you wanted. They changed it as I went in and it became Enfield training program for seven years and then you could go to corporate headquarters. So I knew that that wasn't right. It was a class of about one hundred and there were seven of us that said, we don't want to stay in the field for seven years. And so they pulled us out of that group and we effectively were internal consultants for the year. The company had just gone through a major acquisition on the retail side, and we were responsible for integrating that acquisition, implementing the new procedures and then reporting back to headquarters, both financial and operational results. Now we're twenty two years old. Twenty three years old, didn't really have a good handle of what we were reporting, but we did report things. What I realized
Patrick (CEO of WSO): [00:09:32] I would think they'd have MBAs do that with, like previous consulting backgrounds. But OK, maybe
Stephanie: [00:09:37] This is I mean, this is T. Rex is right. I mean,
Patrick (CEO of WSO): [00:09:42] Like operations go
Stephanie: [00:09:43] Go those pre BlackBerry and see what they're
Patrick (CEO of WSO): [00:09:47] Ok.
Stephanie: [00:09:49] So we, you know, it was interesting we would go back to the corporate headquarters every month and talk about what we were seeing and the CFO and the CEO would come in and chat with us for 30 minutes. And they were very focused on the financial results, right? The integration of this acquisition and what it meant to their shareholders. So for somebody who had been a marketing major, really didn't focus on accounting and finance. It went over my head. And so in conversations really with my father, who had had his MBA from Carnegie Mellon, he said, you know, this is probably the right time for you to go back. So his guidance? Yeah, I went back within the year. I was the youngest in my class by several years and ended up at the time what was a top 20 finance program. And it was it was the perfect program for me. So not having the accounting and finance background, it was very finance and quantitative heavy. So it really kind of rounded out my skill set perfect and that's how I ended up in my MBA.
Patrick (CEO of WSO): [00:10:55] And so you were there, you kind of get a little more confidence, get it a little bit more with the accounting, the finance, you're ready to go. And at this point, you're thinking investment banking. No, just kidding. At this point, you're thinking, you're thinking, why? Because it's a two year program, correct?
Stephanie: [00:11:10] So that was a two year program for summer.
Patrick (CEO of WSO): [00:11:12] What are you recruiting for?
Stephanie: [00:11:14] It's like big. So I actually I didn't really know exactly what I wanted to do. I still sort of thought I wanted to do. A consulting ended up, as I said, at a big four doing restructuring, which has a banking angle. But it's not really investment banking the same way that in a big four that we might know it.
Patrick (CEO of WSO): [00:11:36] Who are you advising the creditor side the debtors or was it?
Stephanie: [00:11:39] No, we were on the company side, so working with the creditors. Got it. Ok. So but really kind of running the PMO for the project management? Got it. You know, it was a great experience for twenty three year old who had really very little experience. Well, I didn't know exactly what I wanted to do. Even after that, I knew that I wanted that finance angle. What I saw was something that was very creative, much more so than I had thought finance to be. So they gave me a full time offer
Patrick (CEO of WSO): [00:12:12] Restructuring, right? You have to get really creative.
Stephanie: [00:12:15] You get very creative. It was a very large company. So kind of one of the two big ones that happened during that time. So when I had an offer to go back full time, I said I didn't really want to go back to the group that I was in. I understood that I needed to really refine my valuation skills. And so I moved from the internship after my second year of my MBA into their valuation group for probably six months. It was enough to really build the skill set, but not enough to kind of challenge and push me forward. So from there moved internally to the corporate development team, which I still think was probably one of the best jobs I've ever had.
Patrick (CEO of WSO): [00:12:56] And tell me why,
Stephanie: [00:12:58] You know, so again, pretty young out of my MBA spent the better part of two and a half years traveling around the world, buying and selling companies for a large, privately held partnership. We had full partner capital to deploy.
Patrick (CEO of WSO): [00:13:13] And this was this was you were buying companies for the big four firm, for the Big Four firm you were talking in consulting practices, stuff like that. Oh, pretty cool. So you're looking at the financials, you're looking at everything and
Stephanie: [00:13:27] Everything, the people, how they report their financials, who their clients are understanding their contracts, really getting into the nitty gritty of the operations of a business that I was part
Patrick (CEO of WSO): [00:13:36] Of. What were the sizes of some of these deals? Just range, just rough range.
Stephanie: [00:13:40] Most of them were fairly small, I would say. Most of them are kind of twenty five to seventy five million. We did a couple.
Patrick (CEO of WSO): [00:13:48] Not so small, very well.
Stephanie: [00:13:51] I mean, smaller. Yeah, yeah, it's not massive.
Patrick (CEO of WSO): [00:13:53] You're doing a massive like, it's not a massive merger with another. You're talking about complementary niche businesses.
Stephanie: [00:14:00] And then we we also spun out some businesses. So one of one of them at the time was the largest spin out that had ever happened there. It was about two hundred two hundred and fifty million. That was interesting.
Patrick (CEO of WSO): [00:14:10] So you get that job. It sounds like an awesome job.
Stephanie: [00:14:13] It was an amazing job because,
Patrick (CEO of WSO): [00:14:14] You know, coming out of the MBA, why did they let you go from valuation to that to that group? Is it we didn't know a lot of people want that, assuming they knew there was so much activity. It sounds like you did a lot of deals.
Stephanie: [00:14:26] We did. We did a lot of deals. You know, the big four, the big four are phenomenal trading houses and they're really great with people who are high achievers and very energetic and bring their best to work every day. For me, it was just putting my hand up and saying I need something more challenging and I'd like something that's faster paced. And I had been talking to some of the bulge bracket banks. I had one offer to leave and they said, Well, we can replicate this internally and I loved I loved the firm. I liked the culture a lot.
Patrick (CEO of WSO): [00:14:56] So they made some what. I would really want to unpack that because I think what you said in terms of you had another offer from a bulge bracket bank. Tell me when you started looking or did a recruiter kind of come after you once they saw you in a specific group at this big four? Like, how did that happen and what was that conversation like? Because I know once you have another offer, sometimes you get that big raise internally or sometimes you get that rapid promo because they don't want to lose you. They start, they realize what they have.
Stephanie: [00:15:22] Yeah, I honestly, it's so long ago, I don't know, it's I'm sure there was, I'm sure there was a recruiter involved somewhere.
Patrick (CEO of WSO): [00:15:29] Yeah. You know, were you looking like, were you actively looking at the banks to go to the investment banking side?
Stephanie: [00:15:35] I knew I wanted to go into M&A, so I joined valuation really to hone my skills. But I knew that it probably wasn't going to be the intensity that I needed.
Patrick (CEO of WSO): [00:15:46] Is it the same thing as like transaction advisory services? Should I think?
Stephanie: [00:15:49] Yes, that's exactly OK. It's part of it. So teams can involve any number of things. It can involve due diligence shoves. But yeah, I was part of the valuation group.
Patrick (CEO of WSO): [00:15:59] Is meeting quality of earnings OK?
Stephanie: [00:16:00] Quality of earnings? Yeah.
Patrick (CEO of WSO): [00:16:01] Ok, now just for the people.
Stephanie: [00:16:03] Valuation tends to be post-deal, so cuvee will happen. Pre deal valuation happens post-deal and it's the purchase price allocation. So allocating the purchase price to the different assets of the company
Patrick (CEO of WSO): [00:16:14] Kind of accounting heavy,
Stephanie: [00:16:16] Its accounting heavy, but it's a great skill set to have. People tend to undervalue accounting in the U.S. If you go to Europe, most investment bankers have one or two years of accounting somewhere in their background, and it makes you a very, ver Patrick (CEO of WSO): [00:16:35] Yeah, absolutely. So, OK, so you got this offer from a wealth bracket. Do you mind sharing what ferma was? Do you remember?
Stephanie: [00:16:42] I do it was I was interviewing both with Goldman and UBS. I had a soft offer from Goldman and a hard offer from UBS.
Patrick (CEO of WSO): [00:16:49] And it was for an
Stephanie: [00:16:50] Associate
Patrick (CEO of WSO): [00:16:52] Associate position post MBA.
Stephanie: [00:16:54] Both Associate Yeah.
Patrick (CEO of WSO): [00:16:56] That's phenomenal. Those pay really well.
Stephanie: [00:16:59] Do you pay really well? But you know,
Patrick (CEO of WSO): [00:17:00] There's a lot you like your firm, you like
Stephanie: [00:17:02] Your loved my firm and there's a lot more to there's a lot more to a job than just what you're making. So the ability at the time I was probably twenty four twenty five. I had the ability to walk into the global CEO's office and give him my point of view on a company that we were buying. When we were negotiating a transaction, I could walk him through my assumptions in the model and there was no amount of comp at Goldman or at UBS that was going to replicate that right.
Patrick (CEO of WSO): [00:17:33] So as an associate, you'd be kind of almost
Stephanie: [00:17:36] Tied to my desk,
Patrick (CEO of WSO): [00:17:38] Tied your desk, but also kind of a little bit more of a monkey and excel monkey and valuation. Absolutely. Rather than actually executing like it sounds like they gave you a lot of leadership, really super young. What were you doing and negotiating some of these deals by yourself, essentially
Stephanie: [00:17:54] Or like not negotiating any of them? So it was a tight team. We were three staff, so under partner and three partners. That was it. And we did everything globally. So we had we reported up to the chairman, the vice chairman of the firm and the chairman, CEO and then the CFO. So those were the three that oversaw the six.
Patrick (CEO of WSO): [00:18:15] Tell me what you're going to do.
Stephanie: [00:18:16] And while I wasn't negotiating on my own, I ran the models on my own. I ran the assumptions on my own and then would report up to them where I thought businesses would fit in, succeed or fail.
Patrick (CEO of WSO): [00:18:27] And what was your mandate like specifically? Was it like you have as much money as you like where you guys actually doing the sourcing? Was there a separate like, tell me the day to day? Like how much was sourcing, how much was execution, how much was that stuff? And then we'll move on.
Stephanie: [00:18:41] Yeah, no, no, no. It's a good question. So one of us was from TI's transaction services. One of us was from strategy, and then there was a kind of director level person on top of the two of us. The strategy person was really involved with the sourcing and I was really involved in the deal and execution. So we sort of passed it between the two of us. But my colleague really did more of the sourcing than I did, and that came from the partners out in the market.
Patrick (CEO of WSO): [00:19:07] And so. Can you walk through like an example, just like it would be sourced, it brought in? Eventually, you guys get out. It's agreed to. And what then what?
Stephanie: [00:19:20] So I mean, typically there was a lot of kind of there was a lot of contract review before we got to Illinois. So understanding the clients of the company, understanding how they generated revenue, understanding the tenor of those contracts, et cetera. Once we hit Illinois, then it really came down to finalizing due diligence. I mean, these are small consulting firms. So they're not they're not manufacturing companies that have overseas assets that you're trying to diligence. It's really getting down to people contracts about your revenue, right? How many people, how much are they billing, how many hours a day? So from a from a diligence perspective, it was really more contractual and then it would just be not only refining the models and then the documentation, but really think about how we brought people into the organization and most importantly, how we integrated within the organization. You know, that's where M&A typically falls apart is the integration piece. So having that experience pretty young was helpful. And so we would work with the lines of service where those companies were getting integrated to think about the acquisition and the integration plan. But, you know, I mean, documentation was. Fine, everything was cash and equity, so it was pretty easy, we wrote a cheque. We did have an unlimited mandate. Anything that was under one hundred million went one way. Anything that was over one hundred million had more steps involved, but it wasn't.
Patrick (CEO of WSO): [00:20:50] Do you know how much across the three years that you were, three plus years that you were there and that group, you know how much? You put to where how much you actually purchased Total. Approximately was like two hundred million
Stephanie: [00:21:06] More than not, I mean, in terms of bought and sold and restructured, I mean, because we did some interesting things with putting together parts of countries and partner capital and redeploying that it was probably between five and seven hundred million.
Patrick (CEO of WSO): [00:21:22] Wow. So you were busy. You're busy.
Stephanie: [00:21:25] You're busy. Yeah, I mean, four, three, four, three people. It was a lot.
Patrick (CEO of WSO): [00:21:29] So tell me why move? It sounds like you have the ear of top level executives. Didn't they want you to be the next one up at some point? Why did you? I mean, I kind of get the sense that there was, you know, you wanted to see the other side of the balance sheet like you said, you wanted to get a little bit more of experience on the debt side or not just writing checks. So tell me a little bit about that and that thought process.
Stephanie: [00:21:52] Yeah. So it really was more around seeing a gap in my own education. You know, at the time, I had a number of friends from business school that had moved into capital markets, DCM, and there was this whole idea of M&A being funded with debt. And at the time, I probably couldn't have told you the difference between how a loan and a bond operates, what the nuances were. And so at some at some point you can ignore it and then you can't ignore it, and then you realise you need to do something about it. It really, you know, was fairly fortuitous. And that had a friend of a friend whose father ran a DCM group at a French bank and we sat down one day for a cup of coffee and just had a conversation. It wasn't really a planned interview or headhunter. It just sort of happened through networking. We talked a little bit about when I started,
Patrick (CEO of WSO): [00:22:52] But had you had you been kind of searching in that last year at the Big Four? Like, had you really?
Stephanie: [00:22:59] I really loved my job at the time.
Patrick (CEO of WSO): [00:23:02] Had it had it changed in it across those three years that they just gave you more responsibility and you're doing more responsibility?
Stephanie: [00:23:07] And every time I would sort of get a little bit itchy to leave, they said, Okay, well, how can we make this more fun and more interesting?
Patrick (CEO of WSO): [00:23:12] So did your pay accelerate as well?
Stephanie: [00:23:16] Hey, accelerated exposure, accelerated travel accelerated. I mean, it was all very good. Yeah. And you know, as you look back on your career, there are points where you're like, Huh? What would have happened if you know, I certainly don't regret the change, but I was in a very good spot. And when you're in your early twenties, you never really appreciate how good you have it.
Patrick (CEO of WSO): [00:23:38] Interesting. Yeah. So do you mind sharing range of pay? I mean, I assume when you started post MBA, you're getting something like the one one hundred and one fifty range. And then
Stephanie: [00:23:48] I think back then it was like ninety five
Patrick (CEO of WSO): [00:23:50] To like base
Stephanie: [00:23:51] Base. And yeah, then there was bonus
Patrick (CEO of WSO): [00:23:53] On top of it. Yeah, so like low hundreds initially and then didn't it really fast like to similar to banking associated, given that you had the banking associate level, did they get you close to that? Like, it's closer to three to four hundred?
Stephanie: [00:24:06] But. Well, remember, so when I made that switch over, we were going into the financial crisis.
Patrick (CEO of WSO): [00:24:12] Yes. So it was 07, right?
Stephanie: [00:24:17] So then I was probably close to the three hundred
Patrick (CEO of WSO): [00:24:20] I meant the last few years at OK.
Stephanie: [00:24:23] Yeah, OK. So there was probably closer to that range. That's great. Not quite that high to seventy five.
Patrick (CEO of WSO): [00:24:31] Maybe that's helpful. Ok. Just give people a perspective of like you had a little bit more of a life I had.
Stephanie: [00:24:38] It was a great life. I worked a lot. I worked probably 80 to 90 hours, but it wasn't one hundred and ten hours. And had I had free range, it was. It was a great job. A lot of responsibility. Yeah, a lot of responsibility and a lot of fun and a great team of mentors. Yeah. So, you know, at the time though, it just seemed like it was time for me to move. Most people would disagree with that, but that's how I felt and
Patrick (CEO of WSO): [00:25:08] Said that conversation. It kind of was just a little bit serendipitous and that nothing planned. And he just said, Hey, I have a spot for you.
Stephanie: [00:25:18] No, not quite that simple, but not so different than that, either, so he ran debt capital markets at a French bank at the time, this was kind of mid two thousand seven, maybe, yeah, July, August. They were thinking about setting up a specialized securitization team and some of the first transactions I had worked at out of out of my MBA and the valuation team were biotech, bioscience kind of stuff. Mm hmm. And so we started talking about the idea of a biotechnology securitization, which seemed great in 2007 before the markets ended. But, you know, so anyway, we spent an hour talking about it and it was like, we'll talk about it again, and we spend a couple of weeks talking about it and talk to some people internally. And he brought me over as a VP. And then the market changed. And so as a banker, you evolve.
Patrick (CEO of WSO): [00:26:15] Yeah, it's kind of interesting the timing. You're talking about securitization and all this stuff, and then that's exactly what the bubble was.
Stephanie: [00:26:22] Exactly, right? Exactly, right.
Patrick (CEO of WSO): [00:26:24] So it's almost like you joined it, like at the last second was that
Stephanie: [00:26:27] Last moment and then
Patrick (CEO of WSO): [00:26:30] You're like, That's what that was your point. Anything, any time you make a jump. It's like right before,
Stephanie: [00:26:36] Right when it changes.
Patrick (CEO of WSO): [00:26:38] Yep, OK. So, yeah, so tell me a little bit about what happened, because it's like it's almost like you're a DCM and DCM, just like it's just a disaster.
Stephanie: [00:26:47] It did implode, but there were parts of it that were fine. So I moved over to project finance. Did some commodities, banking, project finance, banking really loved it. I didn't think I would like,
Patrick (CEO of WSO): [00:26:59] But you moved on pretty fast, correct from that role.
Stephanie: [00:27:03] Yeah, with I mean, within the same bank, but probably within three or four months. Ok.
Patrick (CEO of WSO): [00:27:08] No, but I mean, the firm overall, you moved as well, right? Like under a year.
Stephanie: [00:27:12] Yeah. So that was an interesting that was an interesting move. It wasn't a planned move. The CEO from the bank I was with moved to the other bank and took 50 of us with him. Ok. And so I was part of the same team, just at a different bank there.
Patrick (CEO of WSO): [00:27:26] Ok, that's less of a real move.
Stephanie: [00:27:28] It was less of a real news.
Patrick (CEO of WSO): [00:27:29] I won't count that because you're working with the same team,
Stephanie: [00:27:32] Same team, two mds on either side of me, same to me, is just a different view.
Patrick (CEO of WSO): [00:27:37] So, yeah, tell me about how that evolved then over those couple of years where you were doing on the debt side? Did you feel like you learned a ton at first and then it plateaued pretty quickly or what?
Stephanie: [00:27:47] No, it didn't at all. It was a great experience. So I sat on a structuring team, so we structured into the most efficient execution market market of execution. So we did indicate we did private placements. We did one forty four days a year on this stuff.
Patrick (CEO of WSO): [00:28:03] So tell me, can you for the listeners that don't know or aren't educated on debt, I mean, I guess restructuring, but it's been a long time. So can you give me a little bit, just a little example?
Stephanie: [00:28:12] So Loan Syndicate is a loan that is syndicated into the market more broadly, right? Typically, you're the underwriting bank or there are four or five underwriting banks, and then they sell it. They sell down their positions into a broader bank market, and those are bank loans. So they're typically rate
Patrick (CEO of WSO): [00:28:32] Publicly traded loans that are their market. Are you?
Stephanie: [00:28:39] Yeah, I mean, it's not very public, but they were traded. So the syndicate did trained, OK? Our private placement desk sold into the insurance market, so funds like firms like AIG, MetLife, they have huge bond desks and so we would structure into those markets. The one 40 for a market is quasi public private. It was a newer market at the time, same buyers for the most part. Ok. So insurance companies, asset management companies, firms like PIMCO.
Patrick (CEO of WSO): [00:29:15] These firms are their clients were coming to you trying to help in your helping structure and raise debt for them, basically. Yeah. So all of that in helping syndicate it, helping doing all that.
Stephanie: [00:29:25] Yeah. So we would we would take the transaction, we would typically work with the commercial banker who had the relationship. And then we would structure the transaction. So where do we get the best execution? And then we would price it and put it into the market. So we worked both kind of with the commercial banking side who had the relationships with the clients and were typically the underwriters on the straight loans. And then on the other side, we had relationships with our syndicate desk, which sort of sat in between the two got it. So we knew what the market was doing.
Patrick (CEO of WSO): [00:29:56] So tell me a little bit about your kind of progression on that side and what led to your next move. I find the transitions the most interesting, so I always hard because I think there's a lot of insight into like I mean. Was it like a plateau or was it like initially it was? You wanted to learn on the debts, you want to get more on the debt side. So you had that after a couple of years?
Stephanie: [00:30:19] Yeah, I had that. It was, you know,it was a great transition. So again, I think my experience, my first job to a big four job, which wouldn't tell you that you're going to have an investment banking career because of the maturity that I had to develop and being in the office with the CEO, CFO, day in and day out, I ended up being very getting to know the CEO of this particular bank very well. And he asked me to really think about how we wanted to restructure the Latin American portfolio. It was all commodity based. And so I went through our books and found who we were lending to. We had lots of lots of loans, but there were like 20 million, 40 million. They were meaningless for companies like Antofagasta Valley, Pemex. And so we really spent a year, year, year and a half going through the strategy of how do we restructure that book and create meaningful positions. So one of the positions we took was a. Was a combined cycle power plant in New York that one deal of the year in two thousand nine, it was over a billion dollars. We did a one of the largest deals out of Mexico. In that same time, it was a five hundred million dollar underwriting, which in two thousand nine when the world was falling apart. Those were big deals to get done. Yeah, but it was really relooking at those positions
Patrick (CEO of WSO): [00:31:42] Because of the book. You mean these were loans that were on the books for this bank, but they just hadn't been looked at forever, and you guys hadn't tried to generate new business from those same clients?
Stephanie: [00:31:54] Exactly. So we were basically prior to that. We were the syndicate. We were taking the syndication right. So like somebody would call us, the Bank of America would call us and say, hey, do you want 40 million dollars? And we're like, Great, that's fantastic. But as a result, you're meaningless, right? I mean, 40 million dollars in a, you know, several hundred billion dollar company, who cares,
Patrick (CEO of WSO):: [00:32:13] Just clipping your coupon and whatever.
Stephanie: [00:32:15] Exactly. And so we as those loans rolled off or as we could force companies into a different direction. We did. And so we tried to put more balance sheet to work to become more meaningful and partner with them
Patrick (CEO of WSO): [00:32:28] To larger positions in a smaller number of
Stephanie: [00:32:31] Deals. A number of companies, yeah, that led to me in Latin, in Latin America, quite a bit
Patrick (CEO of WSO): [00:32:36] Got to in Brazil for five months. I was in
Stephanie: [00:32:39] Brazil. Yeah, so I was going back and forth to Brazil, reconnected with at the time, the CEO of an African bank who was an alumnus from my business school. And we had a great time brainstorming what the strategy of that bank might look like and ultimately asked me to come over and help restructure the structure trade team. Wasn't really the right fit, right time. So it was a very short stint, but a fantastic opportunity of learning about yourself and how to kind of have grace under pressure very quickly.
Patrick (CEO of WSO): [00:33:14] And why do you say that just because it was like a pressure cooker there?
Stephanie: [00:33:18] It was it was there were a lot of politics that I wasn't privy to until I got there. Yeah.
Patrick (CEO of WSO): [00:33:24] So like, you got there, you were the person they all wanted to have your chop your head off because you're the new person supposed to look threatening their job.
Stephanie: [00:33:32] Yeah, yeah, pretty much. And you know, nobody
Patrick (CEO of WSO): [00:33:35] Really tapped you as a saviour. You come in and then everyone like, hates you.
Stephanie: [00:33:39] Yeah. Oh, they absolutely did. I mean, one of the people on the desk at the time was like, I will make you hate Brazil so much. You never come back. And I haven't been back since then.
Patrick (CEO of WSO): [00:33:49] Wow. So tell me what type of stuff? Yeah, he did. Were you forced to kind of go through and. Like, it's kind of touch because you can't really like you have the backing of the boss, but he also doesn't want like a mutiny on his hands.
Stephanie: [00:34:04] Yeah, well, and he was on his way out, so by the time my visa was done, he had he was on his way.
Patrick (CEO of WSO): [00:34:10] Oh, that's nice excuse.
Speaker2: [00:34:11] Yeah, he was getting pushed out. So I mean, I was basically like just facing knives. You know, it was basically like being in high school and being bullied again. It was a lot of fun.
Patrick (CEO of WSO): [00:34:22] Ok, so I mean, it makes sense why you left.
Stephanie: [00:34:26] Yeah, you know, it was it was a good experience. We got a few deals done that people were like, you'll never get this deal done. You'll never get it through your committee. We did a silver trade with a Mexican company. We did a couple of other very structured commodities deals. This particular bank was known for commodities.
Patrick (CEO of WSO): [00:34:42] So why was it out that you wouldn't get it done? Because there were tough deals like to get through committee meeting to get approval from the top or
Stephanie: [00:34:49] Whatever it was. It was a new type of deal. It wasn't plain vanilla. And it was a bank that was used to plain vanilla. And so to do something structured, to do something, the American and Brazil, you know, what do I know? You can't even speak the language?
Patrick (CEO of WSO): [00:35:04] Yeah, yeah. Okay, fair. You quickly realize this is not the place to be. You're getting.
Stephanie: [00:35:11] I was going to get shot, whether or not I liked it. I mean, it was going to come. So if I stayed, I was going to. I probably would have gotten fired. And getting fired in Brazil is very different than getting fired in New York when you're an American. So I actually I had dinner with one of the partners from the first big four where I first started, right? And so if if anyone takes anything away from this crazy story, it's manage your network and stay true to your network. I had dinner with a partner from a big four. Here was my manager way back when and now he was a partner at another big four and we were walking through this situation and he was like, you're going to get fired. And I said, Yeah, I am, and he goes, well, let's make sure you're safe. So he had there was a team in another big four. It was all infrastructure and commodity based, and they were partnering that team, that consulting team with corporate finance, which is mid-market investment banking. They wanted to build out private placements and he was like, you'd be perfect for that. So come back to New York. Come for a year. Help us build and then you can go back to banking. And honestly, it was the most gracious thing anyone's ever done for me. He was like, why you're healthy?
Patrick (CEO of WSO): [00:36:26] You're helping, you're helping them, too.
Stephanie: [00:36:30] It was, you know, it was like the timing. It didn't necessarily. It weren't
Patrick (CEO of WSO): [00:36:34] There. You were in a bad spot.
Stephanie: [00:36:35] I was in a tough spot and they weren't planning on hiring that person for probably another year,
Patrick (CEO of WSO): [00:36:42] But they realized that you had you had kind of the perfect mix of experience to be able to lead that. And so is a nice fit there like, oh man, I guess we're going now.
Stephanie: [00:36:51] We're going now. You're going
Patrick (CEO of WSO): [00:36:53] Now. Tell me about that. You were there for a long time.
Stephanie: [00:36:56] I yeah, and you know, of all the things that surprised me in my career, that that's the one I almost a decade. By a few months, almost a decade. Yes. Sometimes it feels like longer, and sometimes it went like in a moment's notice to, I mean, it was it was a great experience. So tell me
Patrick (CEO of WSO): [00:37:14] About like, yeah, the whole progression of the year initially just brought in to do that for a few years. And then how everything progressed. How should people think about like these interesting kind of how almost called a bridge rules that you see? You seem to be playing a lot of bridge roles where you're kind of sitting in between two different divisions. Hmm. Tell me, like, how did you position yourself for a lot of these? Do you feel like it was serendipitous or do you feel like it was something you were doing intentionally because you were getting different, like you had the equity side, then you had the debt side? Was that why it was all happening or why?
Stephanie: [00:37:49] You know, really from my VP days. So 10, 12 years ago, the one thing people always said about my resume, they're like, We really we don't know what to do with you, right? You're not a straight M&A banker, you're not a straight DCM banker. And I actually think it served me remarkably well. It's allowed me to pivot. It's given me a broader base of experience. One of the best pieces of advice I ever got. One of my mentors at one of the French banks had put me in touch with at the time, then CEO of the Americas of Bank of America, right after they merged with BAMMA and or with Merrill Lynch and became Thamel. And so I had I had lunch with him and he said, you know, I said, I don't know what I want to do. I've done M&A. I'm doing DCM. And he said, don't undervalue either of them. The best M&A bankers have DCM experience because they understand how a deal gets done and the best DCM bankers understand why that bond or that loan is being done from M&A. So see the bigger picture. And you know, at the time, I was like, That's great advice. Looking back on that now, 10 years later, that was the best advice I ever got in my career. Did you see the bigger picture?
Patrick (CEO of WSO): [00:39:07] Did you feel like you had already kind of done that, though? I feel like you're already kind of doing that. I get it, I get it. It's like you agreed with it and it ended up serving you really well, no doubt. But like, I feel like you are already headed down that path. I think he was trying to, like, tell you to relax because it would take care of itself almost a little bit because probably like you had it, you had Manny. You had a lot of the M&A really young.
Stephanie: [00:39:33] Well, most I mean, most people who go into investment banking want to have a thousand deals done yesterday, right? And one of the one thing people continue to say and even to me today, you know, it's a marathon, not a sprint. So take your time, like have a have a progression, have a plan and then roll with the punches because there are a lot of them.
Patrick (CEO of WSO): [00:39:52] Tell me about staying with one firm for so long versus like all the options of because you get value, you unlock some value. When you do jump, typically like you can either get a promotion or a pay,
Stephanie: [00:40:03] It's short term value
Patrick (CEO of WSO): [00:40:04] Short term. Yeah. So tell me a little bit about your decision to stay with another big four for almost a decade. After all of this, was it more like you felt you're constantly being challenged and they were promoting you so fast? Or what was that?
Stephanie: [00:40:18] It was purely accidental, like I said, I mean, I thought I would be there for a year.
Patrick (CEO of WSO): [00:40:22] Why only a year you thought you were going to go into banking?
Stephanie: [00:40:24] I thought I would go back to banking. And you know, I love the intensity of investment banking, as most investment bankers do. Or at least investment bankers that stick around until their MD. They really enjoy it. So, you know, it's a great it's a great story. And I don't want to bore everybody with a very long story. But I joined this firm to build out infrastructure, private placements, and we won a 60 billion advisory contract within two weeks of me joining and the
Patrick (CEO of WSO): [00:41:01] Uber responsible for that right?
Stephanie: [00:41:03] Yeah. So we wrote, I wrote the proposal. I was the single director at the time on that proposal. There were partners. Yeah, yeah, it was a huge deal. And one of the partners said to me, he's like, Congratulations, this is your ticket to partner. Now the story gets better. It seems very clean and fantastic guy.
Patrick (CEO of WSO): [00:41:20] You arrived and you're like, Done.
Stephanie: [00:41:23] Yeah, that's not how it played out, OK? We got we, you know, we spent six months negotiating the contract. We had won it away from another big four who had partnered with Lehman before they had folded. So it was a huge deal for us to win it. We were a new team, we were a young team and we finally got
Patrick (CEO of WSO): [00:41:44] To what does that even mean? Like it was just like you guys were going to be there, advisory, like you were going to be all the pure advisory for that.
Stephanie: [00:41:52] So from strategy through raising the capital through construction management, got it.
Patrick (CEO of WSO): [00:41:58] Ok, everything.
Stephanie: [00:41:59] Ok, so start to finish.
Patrick (CEO of WSO): [00:42:02] It's a lot of revenue for you guys.
Stephanie: [00:42:03] It was a lot of revenue. Yes. Was a lot of revenue over a very long period of time.
Patrick (CEO of WSO): [00:42:08] So you mind sharing around is that are we talking like ten million, 50 million?
Stephanie: [00:42:12] Like what it would have been between twenty five and seventy five?
Patrick (CEO of WSO): [00:42:19] I wasn't that far off, OK? No, I had no clue. Ok. That's a lot.
Stephanie: [00:42:24] It was a lot. Yeah, good guess, by the way. Ok, so buy a lottery ticket today.
Patrick (CEO of WSO): [00:42:27] Yeah. Ok, so it seemed like great year. Like everyone saying, congratulations, you're going to make partner super fast. What happens?
Stephanie: [00:42:36] So six months negotiating the contract, we have to go on public record to do the contract. We finally get through all of that. We get to the contracting our risk management calls and said, you know, you need to get back on the plane to New York. Why? Well, because our FINRA charter allows us to do M&A, but not capital raise. I'm like someone probably should have checked out before I joined.
Patrick (CEO of WSO): [00:42:59] Oh my
Stephanie: [00:43:00] Gosh. Oh my gosh. Yeah, so we actually handed that contract back to the firm that we want it from, you know, and then they were like, We don't know what to do with you. So as happens with everyone in their career, at some point about a month later, a partner called me or MD, take your pick wherever you are. And he's like, There's this guy in India. He needs to raise a billion dollars get on a plane. And so I did. And it turns out that it was Mother Teresa's heart surgeon who, when she had woken up from heart surgery, she looked at him and she said, your job is to deliver this at a low cost to the masses. And he spent the rest of his career up to that point, perfecting open heart surgery. His it costs him a fraction of what it would cost in the U.S., and his delivery results were the same as the best three heart hospitals in the U.S.. Wow. And so moved to India ultimately and spent the better part of two and a half years, both working internally kind of taking the role. I had had it the first big four firm that I worked for from an Asia India perspective and then working with this particular client, helping set up his strategic plan for how he would build that heart hospital through India and ultimately globally, we partnered him with three different.
Patrick (CEO of WSO): [00:44:26] It was just how did he have, even as a surgeon, you don't have that much money, right? So how did he have with backing already?
Stephanie: [00:44:34] Yeah, I mean, he was from a fairly well-to-do family is not typical overseas.
Patrick (CEO of WSO): [00:44:40] So he they already had like it was more about like they needed help, just advice.
Stephanie: [00:44:45] They had they had a phenomenal hospital in Bangalore and then they had to build out other prisoners.
Patrick (CEO of WSO): [00:44:52] Ok, so you're there for a couple of years and tell me what that was like?
Stephanie: [00:44:55] It was amazing. It was the hardest and best thing place I've ever lived, right? I mean, every day you go through ups. This is the best day of my life and downs. I can't live until tomorrow here. You know, sometimes the internet would just get shut off and some guy would show up and say, Madam, we need a thousand rupees or five thousand rupees, and we'll turn your internet back on. I had my first child while we were there, so trying to move into parenthood, our son, his first word was dirty. You know, most babies, her mama dada. His was dirty. So there was an interesting experience. It was great fun, though.
Patrick (CEO of WSO): [00:45:35] Ok, so you're there for a few years. You help them raise much capital. It's a success.
Stephanie: [00:45:41] It was a success. Yeah, they're doing great today. They're one of the leading hospitals in the region.
Patrick (CEO of WSO): [00:45:45] Awesome. And so did you come right back to New York or like, I got to get back to New York? Or what was the path then?
Stephanie: [00:45:52] No. So kind of as we've talked about the big for change and they do a lot of different things. And so ultimately our time overseas ran out and they said, you know, where do you guys want to go on the table was I think we had Burma. Someplace else and New York, and we felt like New York was probably right, I was at the time pregnant with our second and had already done overseas childbirth once, and it wasn't really planned. Planning on doing it again. So we moved back to the safety of Fairfield County, Connecticut. Very nice and then came
Patrick (CEO of WSO): [00:46:26] Back to New York and you started working in more kind of cross-border M&A and stuff right away or what? What were you doing?
Stephanie: [00:46:33] So working on in corporate finance, which was cross-border M&A and doing really helping the company, so in that time they had rewritten the FINRA charter so that we could do private placements and so really spent the time kind of educating the partnership on what private placements were rebuilding those relationships with investors and then ultimately rebuilding that business.
Patrick (CEO of WSO): [00:47:00] Maybe at some point you could do a course on private placements for us, for the listeners, and
Stephanie: [00:47:04] Then there's so much fun. They're great. It's of all the markets for execution. I think that that's the one that's the most bespoke. It's so personable. It's really a joy to work with those investors.
Patrick (CEO of WSO): [00:47:18] So tell me a little bit about this latest move. Jan only five months ago,
Stephanie: [00:47:23] Nine months ago.
Patrick (CEO of WSO): [00:47:24] I know what it's what kind of. So of course, you jump and set up your kind of set up your own shop and the wall falls apart. But let's talk
Stephanie: [00:47:33] A little about it. But obviously, because I moved
Patrick (CEO of WSO): [00:47:35] So, so this
Stephanie: [00:47:37] World fell apart.
Patrick (CEO of WSO): [00:47:38] You said initially you were kind of thinking, maybe private equity fund. This is an infrastructure focus on tell me, do you have LP set up? Like, what's the status of where you're at right now?
Stephanie: [00:47:46] And we do so we've made over one hundred and fifty million of investments in the last year. We've already realized one asset. So so that's one hundred and fifty is not including that asset. And while I've only been here since January, I've been working with the team for well over a year at this point. So, you know, kind of knew what I was coming into, you know, and it's been a lot of fun. There's a lot of creativity and entrepreneurial ism in setting up your own shop. But I have
Patrick (CEO of WSO): [00:48:19] Partnered. You started it with you were one of the founding people with this.
Stephanie: [00:48:23] So the founders started a bit before me and then
Patrick (CEO of WSO): [00:48:26] And then you came in as the chief investment officer, we'll call it. So what is your role overseeing? Is it? Are you unlike the investment committee and you argue with them over doing certain deals or not?
Stephanie: [00:48:36] Yes, that's basically so I have the privilege. Our CEO is probably the single best operator of the assets that we're invested in in the country. He's spent his entire career and this asset class, he knows it better than most, but really knows how to optimize them well. And so my background is really structuring. His background, obviously is operational, and it's a nice it's actually a really nice complementary skill set. We have our operations team, we've got a CFO who is fantastic and then have our analysts that do a lot of the work.
Patrick (CEO of WSO): [00:49:10] And so should I think that I think of this fund as very operationally focused, not so much on, not so much financial engineering, but you guys are actually going in working with the asset for how many, like what's a typical hold period for you
Stephanie: [00:49:22] Or what's the? It really depends. You know, I would say our fastest hold period has been two years. You know, I would say typically, certainly right now, I mean. Who knows? Yeah, I would say probably three to five is typical for us. Ok. For assets like this. They're hard assets. They're attached to large, major infrastructure projects. So if you think about a port, an airport, a city center were somehow connected to that. So those assets don't move right. They stay there for into perpetuity. And so we have the benefit of really kind of micro focusing on what we want to change to optimize the performance of that asset. Sit on it until it's time to sell, but they're great cash flowing assets. We don't overleverage. So in terms of your question for financial engineering, you know, unless we're looking at a very specific type
Patrick (CEO of WSO): [00:50:18] Of why wouldn't you leverage up on something that's so stable with steady cash flows, for example, for situations like that
Stephanie: [00:50:24] Right now? That's why you do it, because when nobody goes to the airport and you have a significant cash reserves and you're not over levered, you're really happy. I will say we've managed
Patrick (CEO of WSO): [00:50:38] This is such a once in a hundred year thing. Aren't you leaving a lot of return on the table?
Stephanie: [00:50:44] I mean, it's not that we don't use leverage. We just don't overleveraged. So, you know, I would say overleveraged over levered assets probably are somewhere between seventy five and eighty five percent leverage, maybe slightly higher. You know, we typically are portfolio is probably sixty to sixty five. So it's not that we're not using it, but it gives us a lot of flexibility. Through this period. We haven't had to have a capital call. We've been able to manage our assets to cash flow and have our banks have been great working with us. So we've got good partners.
Patrick (CEO of WSO): [00:51:16] You could see. That is super interesting story, I'm happy you came on, thank you. Thanks for agreeing. So before we leave it or call it anything else you want to share first about the firm you're now working at or anything else you want to share, just advice to younger professionals or the younger listeners out there because you're making me feel old, track and buy a great beer here. But anything else you want to share with them before like, I mean, your path is very interesting. Lots of twists and turns, obviously in some kind of unexpected stumbles along. Yeah. And stumbles. Yeah, it's interesting. I think it's
Stephanie: [00:51:54] Really, you know, I would say every situation you can learn something. The thing that gets you from wherever you are today to MD or whatever role you ultimately want is a positive attitude. A work ethic that's exceptional attention to detail and a humility that a lot of people lose along the way. When you are humble and you're grateful for the experience, you will find something positive and you will turn that opportunity into a better opportunity. So if those are the things that you can hold on to, I would I would say that that is what has served me well for sure.
Patrick (CEO of WSO): [00:52:35] I think people love humility. I think I didn't have enough of it in my 20s. I think it's hard.
Stephanie: [00:52:39] It's super
Patrick (CEO of WSO): [00:52:40] Hard when you're like doing really well and getting big bonuses and you're like, You think you're a half and then and then boom,
Stephanie: [00:52:48] Life is, yeah, and then boom. And then we have coronavirus in the world stops. And all of a sudden you're just like everybody else. But you know, the people who really are humble and gracious and grateful. They're a pleasure to work with, and those are the people that you would want on your teams. And so if those are, you'll always as an MD. The one thing I feel very loyal to are my teams. And so the people who have those traits are the ones that I'll always protect. Yeah. And so as a junior person, those are the things you really want to hold on to.
Patrick (CEO of WSO): [00:53:21] Awesome. I love it. I think we'll end on that because it's pretty applicable for this, this situation, this market. So. Absolutely. Stephanie, thanks so much for joining.
Stephanie: [00:53:30] Really appreciate it. Thank you so much for having me. It was great.
Patrick (CEO of WSO): [00:53:34] And thanks to you, my listeners at Wall Street Oasis. If you have any suggestions whatsoever, please don't hesitate to send them my way. Patrick at Wall Street Oasis. And till next time.
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