Immersion Learning

Understanding My Next Digital Addiction

by Nicholas Baker, MBA ‘15 (3/20/14)
Nicholas Baker, MBA ‘15 When sleeping, I sometimes see rows of brightly colored shapes behind my eyes… my Candy Crush addiction has gone too far.

I am certain that I’m not alone in my over indulgence of digital media. From Facebook groups to my girlfriend’s trawling “fitspiration” blogs on Instagram, constant news updates on Twitter and GroupMe chats read in the back of Über town cars on the way to rooms booked on Hotel Tonight, consumer tech is rapidly enveloping our lives.

Companies are appearing out of the ether at an unprecedented pace, growing from a discontent Yahoo employee to $19 billion in only a few years. When these founders and their investors want to realize the wealth behind developing such ideas, how do they cash out? How are these companies, many of whom have nothing but a rapidly growing user base, valued in the eyes of the market? And, how would you get markets to buy into a company that gives away coupons on your mobile phone? These are all questions my class faced in our latest Investment Banking Immersion case on Initial Public Offerings (IPOs.)

As future bankers, many of who are joining Tech/Media/Telco (TMT) teams, the IPO will make up a large part of our work diet. To get an introduction to this staple, our practicum case for the week was to IPO, or more precisely to out-do the current lead underwriter’s pitch so that our bank would be added to the underwriting syndicate.

For the uninitiated, when a company reaches a certain maturity and the founders, financial backers, and early employees want to realize a return on their investment of time and capital, management will often float the company on a stock exchange in an IPO process. Much of this market for IPOs is in the tech space, with even the developer of my sweet mistress Candy Crush recently filing to go public.

Our mock IPO presentation ran in parallel with’s actual S1 filing (the SEC filing to take a company public), which gave us a very real-world experience, and allowed us to follow how the market ultimately viewed the company. Whilst getting an understanding of how a consumer Internet company is valued provided a great theoretical learning experience, it was playing out the actual strategic considerations of both pricing a company and marketing the equity to potential investors that provided us with a true window into our chosen vocation.

With this experience, I look differently every time I open Twitter on my phone and think of the 74% jump in first day trading. Throughout the semester, it is this change of perspective that may be the most subtle and valuable lesson. I experienced a transformation from casual user to understanding the industry level drivers that will shape my next digital addiction.