My foray into the world of finance started about three years ago when I was asked by my manager if I was interested in working on a finance related project on the side while continuing my regular work as an engineer. Having worked purely as an engineer for six years until that point, I decided to embrace the opportunity to try something new. My company sells semiconductor manufacturing tools and services to major chip makers around the world. My finance related project work included gathering and analyzing data on our tools’ service contract revenues, service costs and gross margins. As a part of this exercise, I came up with ways to reduce our service costs, improving gross margins, and also put together periodic reports for the company’s senior leaders to review. While doing this project, I realized that not only was I good at the financial aspects of the job, but that I really enjoyed doing it. Overtime, I started liking this part of my job more than the technical side. That was when I decided that I was going to transition into a long term career in finance and to help me make the switch, I enrolled into the top ranked part-time MBA program at UC Berkeley’s Haas School of Business.
Since I started the MBA program at Haas about a year ago, I have taken part in many extra-curricular activities outside of class to further hone my financial skills. Being from a non-finance background, I have worked extra hard to obtain the necessary skills to be able to break into the financial services industry. I attended a Training the Street M&A/LBO modeling workshop to gain valuable financial modeling experience. I successfully completed the first round of the Credit Suisse HOLT Valuation Challenge and qualified for the second round. I entered the Credit Suisse HOLT Community Challenge and wrote an essay making a case to invest in an energy industry stock. My stock pitch was especially well received by HOLT’s Academic Review Board and was featured on the Project Firefly website.
The curriculum in my first year of MBA included core courses such as Micro Economics, Macro Economics, Accounting, Corporate Finance, Marketing and Statistics. These classes are designed to provide a solid foundation in business education before the students start taking electives in their areas of interest. The HOLT Valuation Challenge complemented my understanding of accounting and financial statements learned through my MBA courses really well. It showcased an approach to valuation that is not traditionally taught in the class room, but is very practical in its application in the real world. The HOLT methodology helped me understand how traditional accounting methods could obscure a firm’s true performance and how removing the distorting effects of differing accounting standards and various financing choices helps to make a more accurate economic comparison between firms. It showed the best times for a company to make investments for growth and the times when it should divest its assets for creating maximum shareholder wealth. The HOLT Valuation Challenge was a great way for me to gain more exposure to valuation concepts and exhibit my interest in finance outside of my regular course work.
The access to HOLT Lens which I obtained after qualifying for the second round of the HOLT Valuation Challenge was a bonus. HOLT Lens is one of the most powerful tools I have come across for valuing companies. I used it extensively during the HOLT Community Challenge when I had to compare four oil field service company stocks and recommend one of them for investing in. I was able to use my previous knowledge of the oil & gas industry, my financial skills developed thus far through my MBA program and the HOLT methodology via HOLT Lens to make the stock purchase recommendation. I expect to use HOLT Lens as one of the tools going forward in any future IB, PE or LBO case competitions that I take part in. I am sure it will provide an added advantage due to its inherent strengths as a valuation tool.
My goal upon graduating from my MBA program is to become an Associate in a TMT M&A group at an Investment Bank. Other careers I am considering include roles in Equity Research or Private Equity. I expect my career path to become clearer once I finish the second year of my MBA at Haas and enter my final year in the second half of 2016, hopefully with an opportunity to do an internship somewhere in between. I am confident I will be able to leverage my operational knowledge of the technology and energy industries with my growing analytical and financial skills, to transition eventually into a full time role in the financial services industry.
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