WCM 2021 US Industry Conference Recap

Insights from Finance Professionals Working in the US

This past December, WCM hosted our annual US Industry Conference. Over 200 students took part in 10 different events with over 20 finance professionals! In case you missed out, you can find some highlights from the panels and guest speakers below!

Guest Speaker: Kelly Phelan

Kelly is a Director at Asante Capital where she is responsible for originating and leading North American fundraisings for the Group. Kelly is involved with both primary fundraising and secondaries practice, specializing in distribution across North America. Before joining Asante, Kelly was a Vice President at MVision Private Equity Advisers in New York where she was responsible for project management and distribution across Canada and the Northeastern US. Prior to MVision, Kelly worked at Goldman Sachs as an Analyst in the Equity Capital Markets division and also at CIBC World Markets as an Analyst in the Fixed Income, Currencies, and Distribution business in Toronto. Kelly holds an HBA in Business Administration from The Richard Ivey School of Business at Western University, where she graduated with distinction in 2009.

Key Takeaways

On valuing a business:

• The first thing she looks for in a great business is clear differentiation in some aspects of operations or structure.
• Some firms have that differentiated value but are unable to communicate it well, and she loves to help them refine their pitch and get those values across in her work.

Advice on navigating a world of uncertainty after the 2008 financial crisis:

• Put your pride and ego to the side — it’s going to be difficult. So, knock on lots of doors, send out lots of resumes to get yourself out there.
• Give yourself flexibility and explore other opportunities as well — early on in your career is the time to figure out what sort of career path fits you.

Advice on how to network and form better relationships:

• Think of networking as an opportunity for YOU to provide value to the other person.
• For students, find ways to meet other peers interested in finance as well as upper years. Also, join professional networks to meet others in the same field. (Ex: Women in Capital Markets)
• Continue to develop your network even as you move up in your career — many people forget to.

Hard work and honesty are very important values:

• She works hard to deliver value to clients on both sides of the aisle.
• Be honest, even when it means delivering bad news — but find a way to deliver the message so that the listener can continue being motivated. Make sure to maintain a positive atmosphere.
• Other skills that are important to succeed are attention to detail, responsibility for delivering a final product, collaboration skills, and ultimately, tenacity.

Guest Speaker: Charles Korn

Charles is a Partner at Pershing Square and joined the investment team in 2014, where he has since worked on various high-profile investments, including notable public activist campaigns. Charles was previously a Private Equity Associate at KKR, where he focused on media, communications, and industrials. Prior to KKR, he was an analyst at Goldman Sachs in the Technology, Media, and Telecom group. Charles received a degree in Honors Business Administration from The Richard Ivey School of Business at Western University, where he graduated with highest distinction as an Ivey Scholar in 2010.

Key Takeaways

Keep a wide outlook early on in your career, then narrow your focus over time:

• Maintain optionality early on and make strategic decisions at divergent paths considering that some paths close doors quickly.
• For example, Charles had an opportunity to exit straight into investment management after investment banking, but he perceived that he would lose nothing by going into private equity first — and if he turned out to love private equity, then it would be a great career. But if he chose investment management, it would have been more difficult to pursue private equity afterward. So, he chose to work in PE after banking, decided it wasn’t for him, and moved on into a hedge fund.

Invest in great businesses that will compound cash flows in the long term:

• Great businesses are underpinned by an amazing customer value proposition. Then, you should consider the long-term growth potential of the business — for example, if the business is set to compound earnings by the end of a decade, it’s a good return on investment.

On activist campaigns:

• Depending on the situation, Pershing can take a more active or more passive role, with their more active strategies taking different forms like having shareholders vote to replace the board.
• When identifying a business to target, he undertakes substantial research about why a business is underperforming, trying to disprove the initial hypothesis that it’s an intrinsic issue with the business. When he disproves his hypothesis (Ex: they CAN perform at that level, but operational management is the problem), he can then initiate the activist campaign.

On COVID-19’s impact on Pershing’s strategy:

• Permanent changes in consumer behavior as a result of the pandemic must be considered going into the future.
• Pershing spoke with doctors and experts about COVID-19, realized its severity ~2 weeks before the rest of the market — then put out a huge credit hedge.
• In March and April, Pershing thought the market overreacted, so they started repositioning their portfolio back into equity.

Independent thinking and a positive attitude go a long way:

• Rather than just following the groupthink mentality or commonly accepted narratives, think critically about why something is the way that it is, and have a differentiated view (based on evidence).
• People want to work with people they enjoy being around, so don’t be jaded, and try to be helpful and solve problems, treating the job with passion.

Guest Speaker: Adam Pieczonka

Adam is a Co-Founder and Partner at 1907 Capital, a merchant capital firm based out of Naples, Florida. He also operates 1907 Foundation, a charity that funds medical research for mental health. He began his career at Moelis & Company, where he participated in the execution of mergers and acquisitions, debt and equity financings, and restructurings across various industries, then shifted to his role as a Private Equity Associate at Ares, where he worked on a variety of buyout and distressed transactions. Prior to 1907, he worked as a Senior Analyst at Knighthead Capital Management, where he focused on equity and credit investing. Adam received a degree in Honors Business Administration from The Richard Ivey School of Business at Western University, where he graduated with distinction in 2009. Shortly after, he received his MBA from the Wharton School of Business.

Key Takeaways

Resilience is everything:

• Life is full of rejections, and things never work out in a linear fashion. But if you have thick skin and continue being resilient, you will eventually reach your goal.

You have to do what’s right for you, not your peers:

• It’s easy to get in the race-oriented mindset, thinking, “Oh, if I just get X internship, then Y job, then Z position, then… my life is set”, but at some point, there must be a finish line, and you should dictate that by your own terms — this is largely why he founded 1907 Capital.
• Considering that your career will take up around ⅓ of your day for a lengthy period of your life, you should choose the path that provides you with the most value and joy, not make career decisions based on what peers think.

Read biographies of great people who’ve made a great impact:

• You can learn technical information through job experience, but a great thing to do is read biographies on people like John D. Rockefeller, and what they did in their lives and careers (Ex: Titan by Ron Chernow.
• Understanding their rationale for the decisions they made and how they were able to create such a big impact will provide you with insights beyond technical knowledge.

On his vision and mission for the future:

• Adam wants to create a system that is permanent, durable, and resilient, which is founded on the interdependent relationships between the for-profit and non-profit sides of 1907.
• He wants 1907 Capital to be profitable, and for it to have permanent assets to perpetually fund the cause for mental health research, advocating for and finding solutions for the issue beyond what the medical system is doing currently.

Guest Speaker: John Neelamkavil

John joined Onex in Toronto in 2011 and re-joined the firm in New York in 2017 after completing his M.B.A. Since joining Onex, John has been involved with Onex’s investments in Wealth Enhancement Group, OneDigital, Ryan Specialty Group, Sedgwick Claims Management Services, and Gluskin Sheff. He currently focuses on new investment opportunities in the Financial Services sector. Prior to re-joining Onex in New York, John worked in the Onex Toronto office and the Investment Banking division of Credit Suisse. John holds an M.B.A. from Harvard Business School and an Hours Business Administration degree (with Distinctions) from the Ivey School of Business at the University of Western Ontario where he graduated as valedictorian.

Key Takeaways

Don’t limit yourself and chase opportunities:

• During his third year, John applied to numerous investment banks without success. He became discouraged and decided to look into hedge funds and applied to Goldman Sachs Investment Partners. He almost didn’t apply, but realized he shouldn’t limit himself, and eventually got interviews and a summer internship.

Life has a weird way of working out:

• His internship was in August of 2008. By September, the fund drops 30% in a week, and full-time offers weren’t being extended. At the same time, the US was laying off people in finance. He wasn’t able to get to his goal of working in the US, but he was able to work as an investment banking analyst at Credit Suisse in Toronto.
• Life always goes to plan at the end of the day, maybe not in the same time frame as you wanted. With the right mindset and perspective, you can turn setbacks into opportunities.

Your career isn’t always linear:

• After two years at Credit Suisse, and 4 years at Onex, John wanted to pause, take a break, expand his network, and live outside of Canada.
• An MBA allowed him to do all that. The opportunity cost was high, and the MBA wasn’t necessarily needed in his role, but John was very happy with his decision. He wanted to be outside of Canada and eventually did his MBA at Harvard.

You pick up a variety of skills on the job:

• Credit Suisse built his foundations of fundamental financial analysis, but more importantly, it taught him how to work as a professional.

It’s a marathon, not a sprint:

• His boss once told him, in the ’87 crash, he thought his career was over and was looking to pivot, but instead, he put his head down and kept at it.
• Fast forward, he hit the .com bubble and everything crashed. Again, he thought it was all over, but kept grinding. Then the 2008 crash hit, and he did the same thing.
• People are resilient and the systems we work in are resilient, these crashes are temporary, and you can only see that with a zoomed-out perspective.

Investment Banking Panels

On the New York Panel we had:

• Dante Mascarin (HBA ’21), Credit Suisse
• Nick Tommasini (HBA ’21), Evercore
• Laura Bozzo (HBA ’21), Evercore
• Emma Juskovic (HBA ’20), Evercore
• Nina Malczewski (HBA ’21), Morgan Stanley

Featured on the West Coast panel were:

• Harrison Thomas (HBA ’21), Evercore
• David Li (HBA ’21), Houlihan Lokey
• Charlotte Wang (UChicago ’21), Moelis & Co.

Key Takeaways

On the East Coast vs. the West Coast:

• Working in the US puts you in the center of North American business and finance and provides ample opportunity to develop an international network at a young age. West Coast panelists pointed out that if you’re interested in tech, long-term, the bay area is where you need to be. All panelists mentioned the food, culture, and lifestyle of major US cities like NY and San Francisco as being a big draw in their decision to work there.

Major challenges faced on the job:

• Managing converging deadlines was one of the largest on-the-job challenges pinpointed by the analysts. While proving yourself as a new hire, you want to always say yes to taking on additional work, but this isn’t necessarily the best approach. You need to be transparent about your workload because no one knows if you’re drowning or not.

Boutique vs. Bulge Bracket Banks:

• The opportunity to work on global deals across multiple product groups is the core advantage of being an analyst at a bulge bracket bank. At boutiques, the culture of entrepreneurship cultivated by the partners drives analysts to get in the weeds and get their hands dirty. Everyone is eager to take on more work and more responsibility.

Advice for navigating recruiting:

• While networking and interviewing, try to connect with people on an individual level instead of being overly formal and nervous. It makes a big difference if you are happy and excited throughout the interview process. Also, take the time to thoroughly research where you are interested in working. Showing genuine interest in a particular firm or group can go a long way.

Broader Careers in Finance Panel

On the Panel:

• Nicole Dee (HBA ’14), Cadian Capital, Silver Point Capital, Goldman Sachs
• Raunak Gera (HBA ’19), Plaid, Evercore
• Zarbux Daruwalla (HBA ’18), HMI Capital, Ares Capital
• Justin Heo (HBA ’19), Roblox, Moelis & Company
• Ross Graham (HBA ’20), Silver Point Capital, Point72

Key Takeaways

Motivation to pursue a career in the US:

• If you’re going to work in finance, the thing that makes the most sense is to go to a finance hub. The quantity of intellectuals is unmatched and while Canada has high-quality opportunities, the US has more opportunities of the same caliber as well as diversity in opportunities

Reasons to join the technology sector after a career in IB and the lifestyle differences:

• The decision comes down to what do you want as a lifestyle, what do you want to learn, and what are you willing to give up in terms of compensation.
• Lifestyle: There is a better work-life balance in technology compared to Investment Banking.
• Learning: Technology allows you to take a structured way of thinking to fix an unstructured problem. There is the opportunity to think more creatively as well as have more autonomy.
• Compensation: Cash compensation is lower in technology, but you can make up for it with equity.

Reasons to join the public buyside:

• In public buyside, there is more freedom in choosing what you learn about. The fast feedback loop in public investing also allows more opportunities to learn. With that being said, having an investment banking experience prior to public buyside may have benefits as it develops the building blocks to be created which you can leverage.
• Public buyside also has a flat team structure which means that individuals get more responsibility a lot faster than in an Investment Banking career

What it’s like to work in Business Operations:

• BizOps at Roblox is a strategic unit that helps people make decisions. Work is varied and responsibilities can include examples such as figuring out why Silicon Valley does not hire enough engineers or how best to market in Europe using paid ads. Generally, this requires solving problems from a data perspective, and you present the outputs directly to the c-suite and the board.
• BizOps at Plaid is different as the firm has a strategic finance team. BizOps at Plaid is being a strategic business partner for different business units. The team is what aligns the goals that the c-suite sets and the separate teams within the firm. BizOps analysts help implement c-suite goals to the team. BizOps is more about convincing people that what you’re doing is correct rather than taking direction such as a role in Investment Banking.

Shifting investing approach due to COVID-19:

• Technology penetration and adoption have massively increased because of COVID-19 (Ex. Roblox, Instacart). Specifically, fintech & e-commerce have pulled forward.
• Cost-cutting for distressed companies has substantially increased as companies are realizing that they have costs that they do not need.

Key questions include:

• What does steady-state growth look like for these technology companies going forward?
• What are the effects of changes in human psychology and sociology in terms of how humans spend their time? (ex. more people are using Roblox as a socialization tool and user behavior changed with products becoming more embedded in people’s lives)
• To what extent do you capitalize on what has happened this year, do we expect a conversion to pre-covid? Did something change structurally or is this temporary?
• For distressed investing, what % of 2019 can a company get back to?

Advice for students:

• Ask questions wherever you can and take on as much responsibility as possible. Pre-emptive work will set you apart from your peers.
• Your time at school can be thought of as the highest ROI of your time. Work as hard as you can in school as the starting point matters.
• Be yourself when you are at your job. Do not feel the need to conform to a certain culture as this is not sustainable in the long term.
• Be thoughtful on trends that are happening in the world, the world changes every day, and having a longer-term perspective is incredibly important.
• Goal set. This will help you make decisions and avoid missing out on any opportunities.
• Figure out how you learn. You will continue learning throughout your career and your rate of learning will determine how fast you will grow.
• Always be uncomfortable. Not in the way that you hate your job but by pushing yourself beyond your boundaries.
• Do a lot of thinking beforehand and be selective of the recruiting opportunities that you pursue. Instead of applying for everything, manage your time by finding the top 5 jobs that you want to be in and focusing specifically on them.

Private Equity Panel

On the Private Equity Panel

• Basil Smith (HBA ’18), Ares Management
• Brad Perez (HBA ’21), KKR & Co
• Owen Stimpson (HBA ’21), Silver Lake
• Maanit Patel (HBA ’20), Ares Management

Key Takeaways

Pros and cons of joining the buy-side directly from graduation:

• You have to be certain that you want to be an investor, and you need conviction in your technical skills because there is less of a training ground.
• Out of undergrad, there are not that many private equity firms recruiting. Culture is one of the most important things when working in finance, so when there aren’t as many opportunities as compared to the sell-side, it becomes difficult to find the right fit for you.
• Banks, generally, have stronger brand names compared to private equity firms, which makes it a bit easier to exit to other industries.

Important skills in banking versus private equity, and day-to-day roles:

• In banking, you spend a lot more time making slides and formatting them to make everything look nice, which isn’t as needed in private equity. In private equity, you are more focused on the modeling and you own your work more. When you send your work to a supervisor, they aren’t expecting any mistakes.

Things to look for in a deal and possible red flags:

• Does it fit the firm’s investment strategy? Is the management team good?
• Some red flags are seeing hockey-stick growth during the projection period, if the company is being sold for suspicious reasons, or if the management team isn’t strong.

Things you wish you knew when you started your careers:

• Brand name is an important consideration but knowing, fundamentally, what you’re doing at the job is the most important. You want it to be aligned with your interests and what you see yourself doing in the future.
• If you feel that you are being treated unfairly or if you don’t enjoy the culture, you shouldn’t just suck it up for a few years. It’s okay to have a conversation about it with your senior and try to find remedies.
• The work-life balance in private equity is better than in investment banking but it’s still a very time-consuming job compared to other industries. In investment banking, you may be working until 1 AM consistently, but once you exit you are able to pivot into other positions that are fewer hours and more rewarding.
• There’s a huge variation in how much you work depending on the deal that you are on in private equity, whereas in banking the hours are more constant.

Those were the key takeaways from our 2021 US Industry Conference!