Why You Didn’t Land an Offer in Your Final Round Interviews at Morgan Stanley
“Help! I went to my final round interviews but the interviewer didn’t like me from the start and kept harassing me with irrelevant questions. I asked for feedback afterward and they said, “Improve your technical skills.” How can I do that? They didn’t even ask me any technical questions.”
Final rounds are over.
Banks are done giving out offers.
While most of the articles on this site teach you how to improve yourself and land offers, this one has a different message: interviews are random.
Sometimes it’s not your fault if you don’t get an offer.
Really Beyond Your Control?
And you can always improve your technical knowledge.
But sometimes, no matter how many interview guides you’ve read or how many finance classes you’ve taken or how many internships at Goldman Sachs you’ve had, you won’t get an offer.
Problem #1: The Interviewer is Having a Bad Hair Day
Maybe your interviewer just got chewed out by his MD – or maybe a nightmare client ruined his weekend by calling him into work on a Saturday night.
Maybe he broke up with his fiancée right before his planned wedding, or maybe he saw your CV, realized that you’re from a rival school, and decided to hate you as a result.
If you walk into the room and the interviewer is hostile from the start, you won’t overcome that.
What To Do About It: In this scenario you can’t do anything to change the interviewer’s mood – all you can do is control your own emotions.
Always assume the worst when walking into an interview – expect that it will be horribly stressful and that your interviewer will antagonize you the whole time.
And then if it’s better than what you expected, you’ll have it easy – and if it’s as bad as you expected, at least you were prepared.
If it was so horrible that you know you have no chance of landing an offer, you can also ask directly at the end what you could have done to improve your performance.
Not everyone has the guts to do that, and you should only consider it if it was a train wreck of an interview – but that type of question lets you see whether you actually messed up or if it was the interviewer.
Problem #2: The Interviewer is Wrong About a Technical Question
Here are just a few of the incorrect technical questions I’ve seen before:
- The interviewer has the wrong formula for the terminal value in a DCF and claims that he’s right and you’re wrong.
- The interviewer claims that 1 valuation methodology “always” gives a higher value than all the others or that there’s always an exact ranking (there isn’t – it depends on the assumptions).
- The interviewer claims that Depreciation “always” shows up as a separate line item on the income statement (it doesn’t, sometimes it’s partially or fully embedded in other expenses).
There are 3 possibilities when the interviewer has his facts wrong:
- The interviewer genuinely thinks he’s right, even though he’s not.
- He’s testing you to see whether or not you’ll call him on his mistake.
- It’s an advanced or industry-specific topic and his group does things differently from everyone else.
#3 is not terribly likely unless he’s asking extremely advanced technical questions or something where there’s no universally correct answer (e.g. how to project revenue and expenses, which depends on the company and the industry).
#2 is also unlikely because it’s silly to play mind games like that in an interview, but it does happen.
#1 is the most likely scenario – remember, not all investment bankers know finance perfectly.
Some groups get limited exposure to modeling, and banks hire plenty of people without finance backgrounds – so you could always run into an interviewer with weak technical skills.
What To Do About It: If it’s a basic question – e.g. standard formulas in a DCF or how to link the statements together – don’t immediately give in if the interviewer claims that you’re wrong.
Say that you understand what he/she is saying, but that you said something different because [Explain Your Reasoning] – that handles the case where he/she is “testing” you.
Do not do this unless you are 100% certain and it’s a standard question or formula that you’ve seen in books, guides, and other resources before.
But if the interviewer cuts you off or it’s clear that he’s not just testing you after you explain your reasoning, don’t get into an extended argument: sometimes interviewers are just wrong.
But hey, would you want to work somewhere where bankers don’t even have basic technical knowledge?
Problem #3: The Interviewer Keeps Asking Why Your Grades are Low / Why You Didn’t Go to a Top School
So you thought grades and school prestige would only matter for interview selection – but your interviewer disagrees:
- “Why do you have a 3.2 GPA? Are you lazy or just stupid?”
- “Why didn’t you go to Harvard, LSE, or Oxford? I’ve never even heard of your school.”
Unlike problems #1 and #2 above, you can actually prepare for these questions ahead of time – just don’t get blindsided by them in an interview without a plan or you won’t be able to do much.
What To Do About It: You can’t do anything to change your GPA or where you went to school – you only have 2 options:
- Have a good story explaining why you have lower grades or why you didn’t go to a top school.
- Apply for Master’s in Finance programs (or MBA programs in the longer-term) and use those to get a brand name and higher grades.
To explain a low GPA, emphasize improvement over time rather than making excuses (you think they haven’t heard the “family emergency” line before?): acknowledge that you screwed up in your first year but then improved and took classes more seriously.
To explain a less prestige school, say that your family could not afford an expensive option and that you made the most of it to get where you are – remind them what a challenge it was to even get an interview at this bank.
If GPA and school name are a repeated problem in every single interview and they prevent you from getting offers everywhere, then a top Master’s program is your best bet (click here to read all about them).
Problem #4: You’re Put On Hold
You finished your final round interviews and performed well – but a few people were better than you.
You can improve your own performance, but there’s no way to tell what the competition will be like – so this one is out of your control as well.
So you’re on hold, either officially (they tell you) or unofficially (you don’t hear back from them).
You’re tempted to follow-up to “sell yourself” once again and boost your chances…
…but please, don’t do that – at least, don’t do a “hard sell” immediately after.
Persistence is good, but there’s a thin line between persistence and desperation.
Sell yourself before and during the interview, but resist the urge to do so after the fact: it looks desperate and interview decisions are made almost immediately afterward anyway.
What To Do About It: Instead of moving to an immediate “hard sell,” follow-up with everyone within a few days to express your continued interest in the firm.
If they don’t give you a direct answer and time keeps dragging on, call one of them and ask directly what you can do to improve or become a more attractive candidate.
And if it’s something you can fix (e.g., technical skills, communication skills, etc.), do so by submitting evidence of your improvement.
Beyond this, all you can do to accelerate the process is get an offer from another bank, bring it to the first bank, and tell them that you need a decision ASAP due to this pending deadline.
Just make sure you don’t make up an imaginary offer elsewhere and lie about it.
No Offers – What to Do?
Sometimes your offer status is beyond your control – just think about how random the interview selection process is, and now add in all the additional irrationality that comes from meeting bankers in person.
So you need to figure out why you didn’t get an offer and whether you can actually do something about it.
If not, chalk it up to bad luck and move on with life, continue networking, spread your net wider, and follow the advice here if you end up with no offers as recruiting is wrapping up.
And remember: it was the interviewer – not you.
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What’s In Investment Banking Pitch Books?
If you’ve been reading this site awhile, you’ve seen a number of references to pitch books – whether they’re in day-in-the-life accounts, explanations of what bankers actually do, or even horror stories from other sources.
But there hasn’t been much detail on what goes into pitch books, why you spend so much time on them, where you can get some samples, and how you can learn to make them.
So let’s get started:
Types of Pitch Books
People use the term “pitch book” for almost any type of PowerPoint presentation that you create in investment banking.
But this is too broad for our purposes, so I’m going to split “pitch books” into the 3 main types of presentations you create:
- Market Overviews / Bank Introductions – Introducing your bank and giving updates to potential clients.
- Deal Pitches – Sell-side M&A, buy-side M&A, IPOs, debt issuances, and so on.
- Management Presentations – Pitching a client to investors once you’ve actually won the client.
There are other types and sub-types, but 99% of your work in PowerPoint falls into one of these 3 categories.
These 3 main variants have a few common elements:
- Title Slide with the date, bank or client logo, and description of the presentation.
- Table of Contents listing the different sections right after the Title Slide.
- Slides with bulleted text and slides with graphs / diagrams.
There are no fancy transitions, animations, 3d effects, or anything else: pitch books are printed out 99% of the time, so none of that makes sense.
The length varies widely – some presentations might be 10 pages and others might be 150 pages depending on the category, where you’re working, and how much your MD wants you to suffer.
Market Overviews / Bank Introductions
This is the simplest type of pitch book – it’s usually around 10-20 slides that introduce your bank and give an overview of recent market activity to “prove” that your bank knows what it’s talking about.
1. Slides showing your bank’s organization, the different departments, and how “global” you are.
2. Several “tombstone” slides that show recent deals your bank has done in a particular sector. So if you’re presenting to Exxon Mobil, you might show recent energy M&A deals, IPOs, and debt offerings you have advised on.
Along with these, you might create “league table” slides that show how your bank ranks in different areas like tech M&A deals, equity issuances, and so on.
3. “Market overview” slides showing recent trends and deals in the market and data on how similar companies (“comps”) have been performing lately.
These types of pitch books are the least painful for investment banking analysts because you mostly just copy slides from elsewhere and update existing data.
Some banks don’t even use these types of presentations at all – they’re more common at smaller banks where you actually need to introduce yourself.
Sell-Side M&A Pitch Books
Here’s where the fun begins. These pitch books are the longest and most complex, and can sometimes be well over 100 slides.
You create these when a company says, “We want to sell, and we’re holding a bake-off to select a bank to represent us. You get to play – create a presentation and then pitch us on why we should choose you.”
The usual contents:
1. Bank Overview
This is similar to #1 and #2 above, but there’s more of an emphasis on cutting data in creative ways to make your bank look better than it actually is.
“We’re not #1 in energy deals over $1 billion? Try $1.5 billion… try North America only… try between $750 million and $1.5 billion!”
2. Situation / Positioning Overview
Here’s where you create a few textual slides on what makes the company attractive and how you would pitch it to potential buyers.
You might also create graphs showing how quickly the market is growing and how this company dominates the competition, even if it doesn’t.
3. Valuation Summary
This is where you exaggerate the company’s value and make bold promises so that your bank can win the deal.
You start off with a textual summary, then present the infamous “football field” graph showing the company’s valuation according to different methodologies.
Then you show individual methodologies such as public comps, precedent transactions, and a DCF.
Senior bankers usually know how much a company is worth, so they give you a number and you have to work backward to make the data support it.
Yet another reason why banking is not rocket science.
4. Potential Buyers
This is where you give an exhaustive list of everyone who could potentially buy this company.
You might split this into strategic acquirers (normal companies) and financial sponsors (PE firms and hedge funds), and you include a summary slide in the beginning followed by detailed descriptions (“company profiles”) afterward.
This can easily be the most painful section of the entire pitch book.
Imagine looking up a company’s business description, products, executives, and financial information and pasting all of that into PowerPoint… now repeat that 20 times.
5. Summary / Recommendations
You give advice and recommend how many buyers the company should approach, how long it will take, and what your bank is going to do in this section.
These are almost always templated slides taken from other presentations, so this part isn’t too painful.
This contains all the data that no one reads.
You might paste more detailed models, backup data, and even lengthier lists of company profiles into this section.
Bankers like to make presentations as long as possible so thick appendices are very common.
Buy-Side M&A Pitch Books
These are similar to sell-side M&A pitch books, so I won’t repeat everything – the key differences:
- They’re shorter because not as much data is stuffed into the appendix.
- Rather than listing potential buyers, you list potential acquisition candidates – this list may be much longer and you may create more profiles for these companies.
- There’s not as much information on the company’s own valuation – you’re buying another company, not being sold.
Despite being shorter, buy-side pitch books may be more annoying because you have more time-consuming company profiles.
Debt Financing or IPO Pitch Books
These are both similar to the sell-side and buy-side pitch books above. The differences:
- There are no company profiles and no potential buyers / potential acquisitions sections.
- You include relevant financing models – for example, an IPO model showing what multiple a company might go public at and how much in proceeds it will receive.
With no company profiles, these presentations are somewhat less painful than M&A pitch books.
These pitch books – created for real clients instead of prospective clients – are less quantitative and are more focused on the client’s strengths.
You’re pitching the company itself to investors (for debt / equity offerings) or to potential buyers (for sell-side M&A) so you use the client’s colors and presentation theme rather than your bank’s.
The structure depends on the client’s industry – a management presentation for a bank will look much different than a presentation for a tech company.
If we assume that the company is a “standard” one selling products or services to customers, a typical structure might be:
- Executive Summary / Company Highlights
- Market Overview
- Products & Services
- Sales & Marketing
- Expansion Opportunities
- Org Chart
- Historical & Projected Financial Performance
You never use company profiles, information about your own bank, information on other companies (e.g. showing the comps), or valuation data in these presentations.
You still use a mix of bulleted text slides and graph/diagram slides, but it’s harder to generalize the exact slides you might see.
Common slide types: Bar graph showing the total addressable market each year; graphical display of all the company’s products; customers by geography, industry, and size; historical and projected income statements and the most recent balance sheet.
For asset-heavy industries like financial institutions and oil & gas, it doesn’t make sense to discuss “products” or “customers” so you would instead give more detail on their assets, proven and unproven reserves, and so on.
Management Presentations are less repetitive to create than other types of pitch books, but they also take more time to complete.
You might throw together a sell-side M&A pitch book in a few days, but management presentations often take weeks.
That’s not because they’re longer – most of the time they’re actually shorter, in the 30-50 slide range.
Instead, they take more time because you need to interact with the client, get their feedback, and go through more iterations.
The US tends to have the lengthiest pitch books – bankers there like to do work for the sake of doing work.
In emerging markets, such as investment banking in Saudi Arabia, pitch books tend to be simpler and less focused on numbers.
English is the predominant language used in pitch books, but sometimes you see local languages depending on the market – the best example is Japan, where you pretty much need to know the language or you can’t do anything.
Other Types of Pitch Books
There are a couple other types of pitch books and sub-types of the ones described above:
1) Combo Pitch Book / Scenario Analysis
A company isn’t sure whether it wants to go public or sell – so you create a pitch book with both scenarios and show the tradeoffs.
You might also do this if you’re pitching a restructuring deal and you want to show what happens if the company sells vs. declares bankruptcy vs. restructures itself vs. refinances its debt.
2) “Targeted Deal” Pitch Book
A buyer has just approached your client with an acquisition offer and you want to show accretion / dilution under different scenarios.
In this case you would skip all the upfront materials about your bank and just get into business, showing mostly numbers from your analysis.
3) “Client Update” Presentations
You create these if you’re running an M&A deal and you want to update the client on your progress.
You would skip all the fluff and just create a few slides showing who you’ve contacted, what they’ve said, and a summary of any offers received so far.
4) Fairness Opinions
You do these right before a deal is officially announced – they consist of detailed valuations that prove the price your client is receiving (or paying) is “fair.”
Again, you skip all the fluff and get straight into business with a few slides that summarize the offer terms and then a whole lot of slides with valuation graphs and data.
Differences at Boutiques vs. Bulge Brackets
Pitch books are similar no matter what bank you’re at, but there can be a few differences:
- Bulge brackets tend to be more numbers-focused while smaller places may be more qualitative and market-focused.
- Bulge brackets often show more scenarios than boutiques and therefore have lengthier pitch books.
In Other Areas of Finance
Sometimes you see similar types of presentations in private equity, hedge funds, and asset management.
But these presentations are shorter and have less fluff compared to investment banking pitch books.
Some buy-side firms like to make analysts and associates create “investment memos” that summarize everything for the Partners before they make an investment decision.
These look similar to the Management Presentations described above – whether or not you do them depends on your firm’s culture.
Why Do You Spend So Much Time On Them?
You never create pitch books from scratch – you’re always working off of templates and pasting in data from other sources.
So that raises the question – “If pitch books aren’t rocket science, why do you spend so much time on them?”
Much of this goes back to why bankers work so much – so let’s go through the reasons.
You will spend a lot of time making sure that everything is properly footnoted, that all your sentences end with periods, and that the employee counts for all 50 of your company profiles are 100% correct.
If you’ve read Monkey Business, you already know about this one: yup, nothing has changed in 20+ years.
When you distribute your pitch book, the Associate will make one set of changes, the VP will make another, and the MD will make another – which results in conflicts on every single slide.
You will also spend a lot of time receiving marked-up pitch book faxes at 3 AM and then implementing all the changes.
Dozens of Revisions
It’s not uncommon to see “v73” and other large numbers at the end of each file name – sometimes you go through over 100 revisions of a single pitch book.
These have diminishing returns after the first few major changes, but bankers follow the 20/80 rule instead of the 80/20 rule.
You’ll also spend a lot of time trying to decipher what your VP meant when you can’t read anything he marked up in red pen on your latest draft.
Inefficiencies & Pride
It’s one thing if a senior banker wants to sketch out a new graph for you to create, but often they re-write the text of entire slides on the printouts of those slides.
That alone takes longer than re-typing it in the first place, but then it also costs you time because you have to read their markup, interpret it, and type it all over yourself.
Why? Because senior bankers are “above” editing PowerPoint files directly.
Finally, bankers have irrational obsessions: if you’re not murdering people in your bathtub, you’re changing minutiae in a pitch book instead.
When you’re pitching a company, relationships and the actual in-person pitch matter far more than the presentation – but rather than focusing on those, bankers like to spend time on tasks they feel more comfortable with, like changing font sizes in a presentation.
Where Can You Get Example Pitch Books?
They’re quite tough to come by – leaked pitch books are easy to trace back to whoever leaked them because they include bank logos and specific company names.
So, it’s far more difficult to get sample pitch books than it is to find sample Excel models.
Still, you can find a few if you scour the Internet:
- BAML – Sports Authority – Deal Process Update (Consumer/Retail)
- MS – How to Prepare for an IPO
- Sandler O’Neill – Bank & Thrift M&A Presentation (FIG)
- Robert Baird – Gehl Compact Equipment Valuation (Industrials)
- Silverwood Partners – Media & Technology Industry Update
Many of these are quite old, but bankers are creatures of habit, and pitch books barely change aside from the formatting and color schemes.
These tutorials walk you through the process of creating a sell-side pitch book as well as company and deal profiles that you could use in assessment centers, case study-based interviews, and even on the job itself.
These aren’t 100% representative of what you’d see at a bank because they skip over the “bank introduction” section – but you don’t do much original work there as an analyst anyway.
What Do You Do With Them?
Before you start working in banking, you should get familiar with the layout of these different types of pitch books and try to learn some PowerPoint basics.
Don’t go crazy with it because a lot of the process depends on your bank, but it’s always good to know the structure and how to arrange slides, text, and objects before you start working.
More questions? Ask away.
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