Alumni add value to IBI lessons learned
by Zunail Meredia, MBA ’18 (4/25/17)
It’s mid-March and we are deep into the Investment Banking Immersion (IBI) curriculum. It’s our fifth case and we have two weeks to complete it. Each student is responsible for building their own M&A model – which is due the first week – and then students get together in assigned teams to build a deck outlining a recommendation for a potential deal.
Excited to sink my teeth into my first M&A case, I read the assignment prompt and discover companies that I have never heard of before: Gartner, CEB, and Verisk Analytics. The business models are vague and a bit difficult to wrap my head around. Each provides a variety of advisory and research services with technology and data underpinning their insights.
A bit of background on the premise of the case: Gartner/CEB had recently announced a merger and it was our responsibility to advise Verisk Analytics on whether to outbid Gartner for CEB. The case was unique because we had to consider what it would take to break up an existing deal that is already in motion.
My team and I began by validating public claims that Gartner/CEB was double digit accretive without synergies. We did this by building our own M&A models, comparing them within our group, and coming to a consensus on what we believed to be accurate. The Gartner/CEB analysis served as a foundation for the one we would complete for Verisk/CEB. As Verisk’s advisor, we first had to understand what its competitor, Gartner, stood to gain from the transaction and some of the synergies they expected to realize. We conducted a similar analysis for Verisk/CEB and used that to determine what sort of synergies Verisk could potentially realize and the premium Verisk should be willing to pay to remain accretive while outbidding Gartner.
Just as we were putting the finishing touches on our presentation the night before, our lecturer, Drew Pascarella sent the class an email mentioning that two IBI alumni – Ryan Elzas, who currently works at Bank of America within TMT, and Brandon Mallette, who works at JP Morgan within Leveraged Finance – would be joining us as panelists for our presentations. While we were excited to hear critiques and fresh perspectives from investment banking alumni, we also hoped we wouldn’t be the ones selected to present.
Lo and behold, we were the first team selected to present. Not surprisingly, the questions were tough, and we were challenged to substantiate all assumptions. This is typical of presentations in Drew’s IBI and it was no different with the additional guests. It was the first time I was selected to present, and while it was a very tough environment to be in, the experience was invaluable. I learned some important lessons:
Become the expert. As I mentioned, I found the business models of the companies I was analyzing to be vague and intangible. Looking back, I could have spent more time fundamentally learning about the businesses I was covering so I could have an intelligent conversation beyond just the numbers. A great investment banking associate should be able to quickly get up to speed on companies and industry nuances. This is something I will strive to do on cases going forward and during my investment banking internship over the summer.
It’s okay to say, “I don’t know.” There will always be situations where you don’t have an answer to a question. It happened plenty of times during my team’s presentation, and instead of making something up to please the panel, we owned up to what we had overlooked. This is something summer associates can expect to face during their internships, so learning the right approach early on – beyond the raw modelling and needed PowerPoint skills – is good preparation.
The value of alumni involvement in the IBI experience really stood out to me this week. The opportunity to hear different perspectives in our classroom environment has made the IBI a unique learning experience.