Business Week Blog: First Jobs - For Young Professionals

I'm always on the look out for new resources and want to pass along this new blog I found on Business Week called First Jobs. It is a blog dedicated to young entry-level professionals. It has a few interesting posts, of which I have listed below. To learn more check out their site.

• Layoff Coaching 101
• College Grads Facing Worst Hiring Climate Since 2002
• Dressing to Impress: More Important Than Ever?
• Relevant Work Experience A Must, Say Employers to Recent Grads

So you might be asking yourself 'How does this relate to me and how to get a job in banking?". The answer: IDEAS. If you haven't caught on yet, finding a job in investment banking this year, especially if you are from a 'non-target' school, is next to - if not - impossible. (If you are from a 'non-target' school and did get a job in banking please respond to this post listing the name of the school, bank or type of bank, and how you landed a job in banking) As the title of the second blog post above clearly states, "College Grads Facing Worst Hiring Climate Since 2002"!!!! This means, as I have mentioned so many times before, to start thinking outside of the box.

I have listed a few ideas in the March 6, 2009 blog post and want to reiterate a few key principles and ideas.

KEY PRINCIPLE 1:

If you can't get a job in banking.......HOW CLOSE CAN YOU GET TO A JOB IN BANKING?

First, try to get a job in banking. Network and try to get interviews with all the main bulge bracket and middle market banks. Also try to network your way into boutique banks. Next, offer to work for pennies or for FREE (ie. an unpaid internship) at an investment bank. If you get in and do a good job it will lead to bigger and better things, such as a full-time job or a job with another firm. So maybe you have to get a second job because you do not make any money, so what! MAKE IT HAPPEN! You have to trust and realize that working for free is the solution to the great dilemma, 'How do I land a job where you have to have experience to be hired, when I do not have any experience?'. Also, notice (if you haven't already) that the fourth blog post specificially states 'Relevant Work Experience A Must, Say Employers to Recent Grads'.

The next key principle is:

KEY PRINCIPLE 2:
Be Willing To Work For Free*
*Even if it means taking a second job and multiple other sacrifices

This job market is terrible, but let's say you finally pony up and offer to work for free and still cannot find a job in banking, now what?? The next question to ask is 'How close can I come?'. How should we arrive at the answer to this question? If you refer to the blog post First Things First: The Big Five, it lists some key skills to illustrate when interviewing, such as being analytical, quantitative, a team player and a hard worker. If you are working for free and holding down a part-time job, what a great story to illustrate your dedication and hard work in a job interview and an MBA entrance interview.

To illustrate your quantitative, aka financial modeling skills, get a job working for at a bank - regional/merchant bank, for the government at the FDIC, or a private company. As I have mentioned before, take a class from one of the Wall Street training programs or pass your CFA Level I,II, & III. There are many opportunities in today's market place to prepare yourself to get a job in banking. Will it be easy? No, of course not, but with prior proper planning you can prepare and position yourself to be in the right spot to land a job in banking!

Creativity In Times of Crisis!!

This is a funny video, so I hope you like it!  Keep working hard to get the job you want and think outside the box.  If you have a goal to get a job in banking then create an action plan to help you get there and then stick to it!  Do not be afraid to take alternative paths to get there.  Make it happen!

Enjoy!

Full-time Jobs & Internships

With U.S. unemployment at its highest in 25 years, it is going to be a difficult and competitive hunt for your next full-time job or internship.  Investment banks are under heavey scrutiny and reform and the credit markets are frozen.  Businesses in all areas of our economy have been and are being effected.  Right now, more than ever, you need to be proactive in your networking and take full advantage of every resource available.  

Here are some links to important resources and some pieces of information I hope you already use, but in case you don't or have forgotten, I hope you begin to take full advantage these websites.  I am also going to list some alternative ideas that you might want to consider.

Job Websites

Make sure you are signed up and actively using the following websites:

1) Doostang.com - I recommend signing up for their Premium Job service.  They typically have a lot of great jobs and internships posted for undergrads or grads just out of college.

2) eFinancialCareers.com

3) CareerBuilder.com

4) Monster.com

Networking

Use the websites LinkedIn and Facebook to your advantage.  When you see a job posting you are interested in, type the company name into these websites and find out if you know anyone at these companies or if you know someone who can make an introduction for you.  Just sending your resume in will not cut it in today's job market.  You need a personal connection or in to really be considered.  Plus, Facebook groups typically have a lot of group chatter and posts that might be helpful.

1) LinkedIn

2) Facebook

3) Contact your college career center in order to get in contact with alumni

Investment Banks That Are Hiring

Here is a list of investment banks I have seen postings for recently:

- Iron Capital Partners, San Francisco

- Accordion Partners, New York City

- Kaufman Bros., San Francisco

- Fox-Pitt Kelton Cochran Caronia Waller, New York City

- Sonenshine Partners, New York City

- Energy Merchant Bank, New York City

- Leerink Swann, Boston

- Grisons Peak, London

- Taylor-DeJongh Inc., Washington, DC

- America's Growth Capital, Boston

- ThinkEquity, San Francisco

- Bentley Associates, New York

- Clayton Capital Partners, St. Louis, MO

- Lazard, San Francisco & New York City

- Rothschild, New York City & Washington DC

- Financial Technology Partners, San Francisco

- Arbor Advisors, Palo Alto

- Gemini Partners, Los Angeles

- Callisto Partners, West Palm Beach, FL

- Demeter Group, San Francisco

- Credit Suisse, San Francisco

Alternative Ideas

Here are some alternative ideas for entering the investment banking field.

1)  Get into a top MBA program a few years down the road and come in as a full-time associate.  There are many ways to get into a top school.  You just have to make sure you clear the hurdles of having the GPA requirement, 700 GMAT, write great entrance essays, and an interesting story to tell

2) Work for the US Government and the FDIC or another financial regulatory group, such as the SEC.  FDIC is hiring as the Federal Bailout continues to take off .  The government needs to hire more people to manage different processes and programs that are going into place to manage their investments.

3) Work for a merchant bank.  Keep up your finance skills by learning the art of financing.  These jobs can require some travel, but are typically a 9-5 type of job which would allow you time to study for your CFA, Series 7, 63, GMAT, GRE, etc.....

4) Apply and begin studying for additional certifications and tests such as the CFA, Series 7, 63, etc..., GMAT, GRE, or any other designation or certification that could help you get a step ahead of your peers.

5) Get international experience by living abroad for a few months and learning a language.  Or if you already know a language get an internship working abroad.  This always makes for an interesting story and the experience is worth it!

6) Sign up for a class like Training the Street or Investment Banking Institute or another local program to learn advanced financial modeling.  You can also sign up to do the Swiss Finance Academy.  

There are many options in today's world.  Although the world is different today then it was the previous few years, there are still plenty of opportunities and jobs to choose from.  Work hard, network, and be prepared for the opportunities when they present themselves.

Feel free to post alternative ideas or feedback to this post.

Private Equity Prep - Advanced Financial Modeling Skills For College Students

As our subscriber base has grown to include readers worldwide, this blog post is specifically for all of our local subscribers in Utah.  There is finally a training course similar to Training the Street, Deal Maven, Investment Banking Insitiute etc... for students in the Salt Lake Valley.  This is a new program now being offered in Salt Lake City and Provo by Private Equity Prep (PEP) (http://privateequityprep.com).  PEP is taught by a former Wall Street banker and provides advanced financial modeling to provide real world valuation and modeling experience. An advantage of PEP is that it offers the same training as those other modeling courses for less than half price of what the others charge.  

According to their website, "Private Equity Prep was founded in June 2008 by Justin Jory. Before joining a top investment bank in New York City, Justin graduated with a JD/MBA from Brigham Young University and was well taught in respect to corporate finance concepts.  Upon arrival in New York City, Justin quickly realized that a firm understanding of finance concepts was not enough. He found he did not have comparable financial modeling skills relative to peers from Ivy League business schools.  During training, Justin learned that his Ivy League peers attended advanced financial modeling courses that provided them with a significant competitive advantage." If you are living in the greater Salt Lake Valley and looking to get a job in investment banking, then I strongly recommend you look into pursuing this option.  Upon completion of a course such as PEP you will have the knowledge, skills, and experience to push you above and beyond your peers to the next level and land a job in i-banking.

Below I have posted some information about the rigourous course training you will learn during the course of 12 sessions.  

**Notice the key buzzwords you will be able to put on your resume and will be able to speak to in your banking and private equity interviews  

PEP Course Overview 2.25.09

Publish at Scribd or explore others: Business & Legal training investment banking

Methods to Calculate Discount Rates - DCF

Discounted Cash Flow Analysis can be broken down into three sections:

1. Forecast free cash flows for a given period (5 to 10 years generally, and depending on the industry)
2. Discount free cash flows using some discount rate
3. Calculate the Net Present Value

A question you will probably encounter during interviews will be: What discount rate should you use when performing a DCF?

According to Wet Feet, you should know 4 different discounting methods: CAPM Model, WACC, Gorden Model, Hurdle Rate or Rule of Thumb.

1. CAPM Model - Calculating the return on equity (Re)
--- Re = Rf + Beta (Rm - Rf)
--- Beta is a measure of how sensitive the equity price is to the market (also known as market risk)
--- (Rm - Rf) is known as the risk premium (generally 5%-9% depending on your source information)

2. WACC (Weighted Average Cost of Capital)
--- WACC = Re*E / (D + E) + Rd (1 - Tc ) *D / (D + E)
--- Re = return on equity
--- Rd = return on debt
--- E = market value of the equity
--- D = market value of debt (usually assume equal to BV
--- Tc = corporate tax tate

3. Gordon Model
--- Re = D1/P0 + g
--- D1 = next years' expected dividend
--- P0 = today's stock price
--- g = the expected growth rate of dividends
--- this model assumes a constant dividend payout ration and dividend growth into perpetuity

4. Hurdle Rate or Rule of Thumb
--- Determine some rate of return - say 12% - and only accept investment projects or opportunities that exceed that rate

What are League Tables?

As we have discussed in the past, when interviewing with an investment bank you should be prepared to answer the question: Why this bank?

There are several elements to answering this questions effectively. You will definitely want to talk about the "Culture" of the bank. This is when you tell your interviewers what their perspective of the institution is. Speak with analysts at the bank to get an understanding of this.

Another possible element is the "People." This is where you rub the interviewers back and tell them how great they are. "The people I've interacted with the firm have been . . . .". If you mention individuals names, you sound more sincere.

Finally, to our topic, you will want to highlight the bank's performance or "Strengths." Using league tables to discuss this subject gives you the physical data and makes you sound highly informed on trends in the industry.

League tables are published every quarter by Thompson Reuters and can be found here.

Take some time and acquaint yourself with this resource; the more familiar you are with these, the more informed you'll sound.

If you're interviewing with a bulge bracket investment bank, you'll want to look through the most recent debt and equity tables as well as the global M&A. Look for trends and highlights. Maybe the bank is a middle of the road M&A shop but is particularly strong in Asia Pacific M&A. Maybe your bank is traditionally an equities shop but has a real and growing presence in Latin America debt offerings. If you can find a way to mention your source when talking about the bank's strengths your arguments will sound solidly based.

Hot Keys: What's a Mouse For?

A friend of mine recently interviewed with a boutique investment bank and a section of the interview included a 1 hour financial modeling exercise. How well prepared are you to build, format, and forecast the income statement of a public company? Do you know the keyboard shortcuts necessary to complete this task in under an hour?

During my internship this summer, the full-time analysts explained to us that using the mouse makes work less efficient and ultimately slower. We were challenged to use only our keyboards and to never use the mouse. Thankfully I was prepared because I had been practicing keyboard shortcuts for some time prior to the internship. I extend that same challenge to you; never use the mouse when you can use Hot Keys. You'll never regret it.

I've taken a list of Excel 2003 Hot Keys from DealMaven and have posted them below. Most banks haven't upgraded to Microsoft Office 2007 so focus on learning these.

Excel Shortcut Keys
Command Name	Keystroke	Category	Priority	Comments
File New	( Ctrl n ) / Alt fn	Files	5
File Open	( Ctrl o ) / Alt fo / Ctrl F12	Files	5
File Close	Alt fc	Files	5
File Save	( Ctrl s ) / Alt fs	Files	5
File Save As	F12 / Alt fa	Files	5
File Print	( Ctrl p ) / Alt fp	Printing	5
File Set Print Area	Alt fts	Printing	5
Insert Page Break	Alt ib	Printing	5
File Clear Print Area	Alt ftc	Printing	5
File Page Setup	Alt fu	Printing	5
File Print Preview	Alt fv	Printing	5	Use Esc to exit print preview mode
Edit Undo	( Ctrl z ) / Alt eu	Commands	5
Edit Redo (Reverse Undo)	( Ctrl y ) / Alt er	Commands	5
Repeat Last Command	F4 / ( Ctrl y ) / Alt Enter	Commands	5	Use F4 while outside Formula Bar
Enter/Exit Cell Formula Bar	F2	Formulas	5	You can use Esc to exit Formula Bar as well
Absolute/Relative Reference	F4	Formulas	5	Use F4 while in Formula Bar
Sum Formula	Alt =	Formulas	5
Insert Function (Function Wizard)	Shift F3	Formulas	5
Insert Defined Name in Formula	F3	Formulas	2
Insert Function Arguments	Ctrl Shift A	Formulas	1
New Line in Cell Entry	Alt Enter	Formulas	3	Use while in Formula Bar
Delete Remainder of Entry	( Ctrl Delete )	Formulas	3	Use while in Formula Bar
Finish Entry	Enter	Formulas	5	Moves selection depending on Excel user preferences (Shift Enter moves selection in opposite direction
Finish Entry and Move Right	Tab	Formulas	5
Finish Entry and Move Left	Shift Tab	Formulas	5
Fill Selection With Entry	Ctrl Enter	Formulas	3
Calculate Formulas	F9	Formulas	4
Move Up	Up Arrow	Navigation	5
Move Down	Down Arrow	Navigation	5
Move Left	Left Arrow	Navigation	5
Move Right	Right Arrow	Navigation	5
Quick Move Up	Ctrl Up Arrow	Navigation	5
Quick Move Down	Ctrl Down Arrow	Navigation	5
Quick Move Left	Ctrl Left Arrow	Navigation	5
Quick Move Right	Ctrl Right Arrow	Navigation	5
Move To Column A	Home	Navigation	3
Move To Last Used Column	End, Enter	Navigation	3
Move To Cell A1	( Ctrl Home )	Navigation	3
Move To Bottom Right Cell	( Ctrl End )	Navigation	3
Page Up	Page Up	Navigation	5
Page Down	Page Down	Navigation	5
Page Left	Alt Page Up	Navigation	3
Page Right	Alt Page Down	Navigation	3
Next Worksheet	( Ctrl Page Down )	Navigation	5
Previous Worksheet	( Ctrl Page Up )	Navigation	5
Next Workbook	Ctrl Tab / Ctrl F6	Navigation	5
Previous Workbook	Ctrl Shift Tab / Ctrl Shift F6	Navigation	5
Go To...	F5 / ( Ctrl g ) / Alt eg	Navigation	5
Highlight Up	Shift Up Arrow	Selecting	5
Highlight Down	Shift Down Arrow	Selecting	5
Highlight Left	Shift Left Arrow	Selecting	5
Highlight Right	Shift Right Arrow	Selecting	5
Quick Highlight Up	Ctrl Shift Up Arrow	Selecting	5
Quick Highlight Down	Ctrl Shift Down Arrow	Selecting	5
Quick Highlight Left	Ctrl Shift Left Arrow	Selecting	5
Quick Highlight Right	Ctrl Shift Right Arrow	Selecting	5
Select To Column A	Shift Home	Selecting	1
Select To Last Used Column	End, Shift Enter	Selecting	1
Select To Cell A1	( Ctrl Shift Home )	Selecting	1
Select To Bottom Right Cell	( Ctrl Shift End ) / ( End, Shift Home )	Selecting	1
Extend Selection Page Up	Shift Page Up	Selecting	1
Extend Selection Page Down	Shift Page Down	Selecting	1
Extend Selection Page Left	Shift Alt Page Up	Selecting	1
Extend Selection Page Right	Shift Alt Page Down	Selecting	1
Select Row	Shift Spacebar	Selecting	5
Select Column	Ctrl Spacebar	Selecting	5
Select Region Around Active Cell	( Ctrl Shift * )	Selecting	1
Select All (Entire Worksheet)	( Ctrl a ) / Ctrl Shift Spacebar	Selecting	3
Set/Clear Selection Anchor	F8	Selecting	3
Only Select Active Cell	Shift Backspace	Selecting	1
Move Down Within Selection	Enter	Navigation	3
Move Up Within Selection	Shift Enter	Navigation	3
Move Left Within Selection	Tab	Navigation	3
Move Right Within Selection	Shift Tab	Navigation	3
Move Clockwise Within Selection	( Ctrl . )	Navigation	1
Next Region Within Selection	Ctrl Alt Right Arrow	Navigation	1
Previous Region Within Selection	Ctrl Alt Left Arrow	Navigation	1
Delete Selection	Alt ed	Clear/Delete	5
Clear Everything Within Selection	Alt eaa	Clear/Delete	5
Cut	( Ctrl x ) / Alt et	Cut/Copy/Move/Paste/Insert	5
Copy	( Ctrl c ) / Alt ec	Cut/Copy/Move/Paste/Insert	5
Paste	( Ctrl v ) / Alt ep	Cut/Copy/Move/Paste/Insert	5
Paste Special - Formulas	Alt esf Enter	Copy/Paste	5	Copies formulas and nothing else
Paste Special - Formats	Alt est Enter	Copy/Paste	5	Copies formats and nothing else
Paste Special - Values	Alt esv Enter	Copy/Paste	5	Copies values and nothing else
Copy Right (Excel)	( Ctrl r )	Copy/Paste	5
Copy Down (Excel)	( Ctrl d )	Copy/Paste	5
Copy Value From Cell Above	( Ctrl Shift " )	Copy/Paste	3
Copy Formula From Cell Above	( Ctrl ' )	Copy/Paste	3
Insert (Copied) Cells	Alt ie	Cut/Copy/Move/Paste/Insert	5
Insert Row	Alt ir	Insert New	5
Insert Column	Alt ic	Insert New	5
Copy/Move Sheet	Alt em	Cut/Copy/Move/Paste/Insert	3
Insert Worksheet	Alt iw / Shift F11	Insert New	3
Insert Chart Sheet	F11	Insert New	1
Edit Delete Sheet	Alt el	Clear/Delete	3
Highlight Direct Cell Precedents	( Ctrl [ )	Auditing	3
Highlight Direct Cell Dependents	( Ctrl ] )	Auditing	3
Highlight Indirect Cell Precedents	( Ctrl { )	Auditing	3
Highlight Indirect Cell Dependents	( Ctrl } )	Auditing	3
Show Precedent Arrows	Alt tut	Auditing	3	Refers to direct precedents
Show Dependent Arrows	Alt tud	Auditing	3	Refers to direct dependents
Display Cell Formulas (Toggle)	( Ctrl ` )	Auditing	3
Find	( Ctrl f ) / Alt ef / Shift F5	Auditing	4
Replace	( Ctrl h ) / Alt ee	Auditing	4
Edit Links	Alt ek	Auditing	3
Window Freeze/Unfreeze	Alt wf	View	5
Window Split	Alt ws	View	5
Split Window Toggle	F6	View	3
View Zoom	Alt vz	View	4
View Page Breaks	Alt vp	View	3
View Normal	Alt vn	View	3
Insert Name (Define)	Alt ind / Ctrl F3	Other	5
Insert Comment	Alt im / Shift F2	Other	3	Use Shift F2 to edit comments as well
Edit Clear Comments	Alt eam	Other	3
Insert Hyperlink	( Ctrl k ) / Alt ii	Other	2
Insert Current Date	( Ctrl ; )	Other	3
Insert Current Time	( Ctrl Shift : )	Other	3
Bold	( Ctrl b )	Formatting - Font	5
Italics	( Ctrl i )	Formatting - Font	5
Underline	( Ctrl u )	Formatting - Font	5
Strikethrough	( Ctrl 5 )	Formatting - Font	1
Border Outline	( Ctrl Shift & )	Formatting - Borders	3
Remove Borders	( Ctrl Shift _ )	Formatting - Borders	3
Cell Formatting Dialog Box	( Ctrl 1 ) / Alt oe	Formatting	5
Edit Clear Formats	Alt eaf	Formatting	3
Column Autofit	Alt oca	Formatting - Rows/Columns	5
Row Autofit	Alt ora	Formatting - Rows/Columns	2
Column Width	Alt ocw	Formatting - Rows/Columns	4
Row Height	Alt ort	Formatting - Rows/Columns	4
Column Standard Width	Alt ocs	Formatting - Rows/Columns	1
Group Rows/Columns	( Alt Shift Right Arrow )	Hiding	3
Ungroup Rows/Columns	( Alt Shift Left Arrow )	Hiding	3
Hide Rows	( Ctrl 9 )	Hiding	3
Hide Columns	( Ctrl 0 )	Hiding	3
Unhide Rows	( Ctrl Shift 9 )	Hiding	3
Unhide Columns	( Ctrl Shift 0 )	Hiding	3
Restore Window Size	Ctrl F5	Windows	3
Minimize Window	Ctrl F9	Windows	3
Maximize Window	Ctrl F10	Windows	3
Close Window	Ctrl F4 / ( Ctrl w )	Windows	4
Next Application	Alt Tab	Windows	5
Previous Application	Alt Shift Tab	Windows	5
Close Application	Alt F4	Windows	4
Windows Start Menu	Ctrl Esc	Windows	5
Spelling Check	F7	Other	3
Tools Options	Alt to	Other	4
Activate/Deactivate Menu Bar	F10 / Alt	Other	5	Use arrows or menu accelerators to move through menu options
Show Right Click Menu	Shift F10	Other	4
Next Toolbar	Ctrl Tab	Other	3
Previous Toolbar	Shift F10	Other	3
Show/Hide Standard Toolbar	Ctrl 7	Other	1
Run Macro	Alt F8	Other	3
Visual Basic Editor (Toggle w/ Excel)	Alt F11	Other	1
Help	F1	Other	5
Help (Context Sensitive)	Shift F1	Other	3