A Day in the life of a Leveraged Finance Structuring/Origina
Published: Mar 10, 2009
8:30 a.m.: You arrive at the office via the subway, coffee in hand, to find yet another markup on your chair of the pitch from your associate. Thankfully it's only a few minor errors that you overlooked, but it means that you're going to spend the next few hours racing around, making changes and substituting new pages. At any rate, it is better that you all caught the mistakes before you were actually in the pitch. Usually you are not in the office until 9:30 or 10, but with an important client pitch, you knew you had to be there early today.
8:40 a.m.: You log in and check your voice mail, only to have 20 new e-mails from your other deal teams, capital markets colleagues, friends and lawyers. You ignore a voice mail from your buddies, knowing that you'll need all of the next two hours. You put everything else that was on your chair into the stack of "stuff that'll get done later."
8:50 a.m.: You're already cranking into the changes, saving the presentation, when your MD drops by your desk and says, "Let's make this final change and update this slide." After you quickly do so and incorporate the other changes, you send the pitch over to your production group, with instructions on which slides to replace in your 30-page presentation.
9:30 a.m.: After sending the presentation, you walk over to find that the production group is slammed with last-minute requests. You call up your associate, who comes over to help. For the next 30 minutes, you are printing and swapping out pages while checking your BlackBerry. You also return to your desk to quickly burn the new presentation to a CD and save it, yet again, to your hard drive. Once the books are completed and flipped, you throw them in a bag and call your car service to make sure that a car is ready and waiting to leave at 10:15.
10:00 a.m.: You've returned to your desk, only to have a flurry of messages on your desk for other deals. Ignoring them, you grab your suit jacket, check yourself over once in the mirror, and stop by the VP's desk, books and laptop in hand. The associate is right behind you and now you're just waiting on your MD, who is on the phone with another client.
10:30 a.m.: Now in the car, you're only 10 minutes away from the client's office. The VP flips through the presentation only to temporarily freak out at the last-minute addition. The MD assures the VP that she made the change and everyone reviews their speaking points for the presentation. Being exceptionally diligent, you have printed out the latest news about the client from the company web site, as well as online finance sites. You pass copies around. Even though it's a standard refinancing, it's multiple billions of dollars in financing for one of the firm's most prominent clients, which means that if all goes well, there are definitely more transactions in the pipeline for your team.
10:45 a.m.: You arrive at the client's office and are escorted up to their boardroom. You set up your laptop (the associate has also brought a backup) and you plug everything in. You also set up each chair with a copy of the presentation and establish a dial-in line, as your capital markets expert was not able to make it in person. From a presentation standpoint, everything is good to go, which is your primary responsibility. You check for any last-minute BlackBerry messages before the presentation begins.
11:00 a.m.: The client arrives and the pitch begins. Business cards are passed out, pleasantries are exchanged, and the slides are discussed. Occasionally stopping for questions, the MD and VP tag-team the presentation while you and the associate stay alert for any financial modeling questions. As it happens, the CFO poses a brief question to you about the assumptions in the financial model, which you rattle off with ease. Scheduled to last two hours, the pitch moves quickly and actually ends on time. The client is pleased, yet wants to discuss internally and get back to you with questions before arriving at a final conclusion.
1:30 p.m.: The car you scheduled for the trip drops you off at the office and you return to your desk exhausted. You grab another analyst and head out to a local deli to pick up some lunch.
2:00 p.m.: Now eating lunch at your desk, you sort through voice mails and e-mails to determine what you need to conquer in the afternoon. You've already got a sit-down with credit at 4 p.m. to discuss an auction financing for an LBO by a major private equity firm, which credit already does not like. Also, you have a conference call at 6 p.m. to discuss closing dinner slides with your coverage counterparts for your most recent transaction. Naturally, the associate from your 4 p.m. deal has been eagerly awaiting your arrival from your pitch, ready to tweak the financial model and credit package with the newest changes from that VP and MD. With a bid deadline on Tuesday, the financial sponsor coverage group wants to get approval before the weekend to put together some financing slides for a Monday morning presentation with the private equity firm.
2:30 p.m.: After you've made a list of things to get done and have returned a phone call or two, you realize that these "tweaks" are going to take every minute of the next hour and a half. You grab the most recent financial model from the share drive, throw on your headphones and start cranking. If you are lucky, the model will not implode and you will make the 4 p.m. deadline.
3:00 p.m.: Your parents call. They're worried about you, since you haven't called in a few weeks. You tell them that you'll have to call them later, but everything is alright. Now, back to cranking on your financial model.
3:30 p.m.: The model is complete with the newest assumptions and you drop these new numbers into the credit package. You scan through it to make sure nothing else needs updating. Doing this, you notice that, the financing scenario is better, but still somewhat unlikely to get approved. The associate and VP stop by your desk to take a look and make sure they don't want to make any other changes.
3:40 p.m.: The financial sponsor coverage team called and wants to check on the conference room for the meeting with credit. You double-check, get back to them and call up the credit executive. The associate and VP made their minor changes to the presentation, so you click print on 10 copies on the presentation and the financial model. The printer is busy, but you've got two backup printers across the floor. Clicking print on both of these printers, you and the associate grab five binder clips each and wait for the printing to finish. At 50 pages each, this could take a little while.
3:55 p.m.: The printing is complete. Promising to meet the VP and MD in the conference room three floors down, you and the associate grab your notepads, financial calculators, binders of company information and the credit packages. You should make it with a minute to spare.
3:59 p.m.: Nearly out of breath but right on time, you pass out the credit packages to everyone in the room: the financial sponsor's coverage team, your origination/structuring team, the corporate banker, the credit executive, the loan capital markets MD and the high-yield capital markets MD. For the next hour, everyone reviews the package, asks questions about the deal, the due diligence and the company. You get to answer all of the financial modeling questions, while the associate tackles the mundane company questions, since you both decided early on to adopt these sections of the presentation. Somewhere during the presentation, you notice two or three minor errors, but since they're buried in 50 pages of work, nobody can blame you. Surprisingly, at the end of the meeting, the credit executive gives signoff, but asks for some minor information, which you make note of and promise to deliver. The financial sponsor coverage team schedules another sit-down on Tuesday morning to discuss the sponsor's reaction to the financing proposal, since they will be with the client all day on Monday. However, at this point, your firm is just trying to remain competitive with the other financing firms and it's expected that there are many rounds of bidding and credit approval remaining, if your private equity group also remains competitive with its overall bid.
5:00 p.m.: With so much racing around, you avoid your desk to grab a quick cup of coffee with an associate friend of yours. A recent business school grad, she talks about how much you would enjoy the two-year break from this lifestyle. A third-year analyst up for the analyst-to-associate promotion next year, you recognize that you have a lot on your plate to consider. However, bonus talk has already come out for the first-year associates, and with numbers that high, it looks quite enticing to stay around for a few more years.
5:15 p.m.: You return to your desk, scan your list of things to do and knock out the low-hanging fruit, as well as those things needing to get done before 6 p.m. The MD with your deal team from the morning pitch has just talked with the client, who accepts your firm's financing offer. He fires around an e-mail with congratulations, as well as a first-thing deal team sit-down in the morning to get started on drafting the info memo and launching the transaction. In the meantime, he tells everyone to go home soon, since there's plenty of work to do tomorrow. Although exciting, you know that you will spend the majority of your weekend cranking on an info memo and prepping for a deal launch. Thank goodness this transaction is a standard loan refinancing from a prior deal, otherwise you would be up all night worrying about a high-yield roadshow and/or rating agency presentation.
5:50 p.m.: You finish up some e-mails and phone conversations, so that you can check out what is needed for the 6 p.m. conference call. Planning a closing dinner is somewhat enjoyable, as it is a chance to reminisce about the deal. You quickly review the deal toy choices, which were sent over to you from the firm preparing them, and you e-mail those choices out to the team. Since the dinner is two weeks away, you're still in the idea generation phase with the team, but you have already written down memorable quotes, made a reservation at a high-end restaurant, sent out invites and put together a slide of transaction highlights.
6:00 p.m.: The conference call only lasts 30 minutes and everyone is given a task to complete before Monday morning. Your task is to start sketching PowerPoint slides with the associate. Enjoyable? Somewhat. Time consuming? Very.
6:30 p.m.: You start thinking about ordering dinner for the evening, while you check CNN and ESPN to see what happened in the world today. Since you will definitely be at work late, you place an order with your team from the local Chinese restaurant.
6:45 p.m.: You make a quick call to the parents, who are happy to hear that all is well and that you are still alive.
7:15 p.m.: Dinner arrives, so you go downstairs to pick it up. Carrying it upstairs, you locate an unsuspecting conference room, which will now smell like General Tso's chicken for the next two days. Most of the analysts and associates from your group eat dinner together, talking about anything and everything.
7:45 p.m.: You get back to your desk to find a markup of the credit package from the VP on your second deal. The credit package markups are needed by first thing in the morning, as the financial sponsor coverage team wants to switch up the transaction structure entirely. Of course, this will require another meeting with credit tomorrow, which means all chances of a reasonable Friday departure are ruined. Also, it is about right now that you realize you'll be cranking most of this weekend to update slides in the financing pitch for Monday. However, since it is not the final round of the auction, this will be a relatively easy task. Realizing that you also have a first thing meeting with the MD of your live deal, which will likely take all day to finish, you decide to knock out these credit package changes ASAP.
10:00 p.m.: After finishing the modeling of the new transaction structure, with your associate periodically checking in, you are able to finally send over the credit package and model to the financial sponsor coverage team. They take your information, review it, and will undoubtedly call you with questions. However, after a quick water break it's time to crank on the new info memo, for your live deal. You start by preparing the essentials: the contact list, the table of contents and framework, the timetable and the historical company financials.
10:30 p.m.: The financial sponsor coverage team calls about the model, which makes you nervous. However, they call to say thank you and to ask about some quick modeling assumptions you have made. You walk them through your changes and plan on touching base with them tomorrow. Since you have everything under control, your associate from this deal decides to go home.
11:00 p.m.: The associate for your live deal was stuck cranking on a lenders' presentation for another deal, but is finally packing up her stuff and calling the car service to go home. Knowing that you have a chance to save at least a few hours of your weekend time, you decide to crank for a little bit longer on the info memo. Since tomorrow will be busy, this also might be all of the good cranking time you've got in the next 24 hours. Also, you know the deal team will be impressed when you've made good progress by tomorrow on the outline.
2:00 a.m.: Realizing that you're exhausted, but have made great progress on the basic sections of the info memo, you decide to call it a night. Thankfully, there are many other analysts still cranking away, who kept you company for the past few hours. Since you live in Manhattan, you do not need to call a car service. Instead, you will just hop in a taxi waiting outside. To finish up the day, you respond to some e-mails from friends, shut down your laptop and grab your BlackBerry. It has been another long day at the office, but the weekend is getting close.