This past summer, I had the opportunity to intern with a $2B private equity firm. The firm’s point of differentiation, as far as investment strategy, was to invest in environmentally contaminated real estate properties that would otherwise be desirable. They would pursue tax credits in the purchasing process and deploy environmental remediation teams to restore the property to being buildable land. My role, as an analyst, was to determine valuation based on predicted cash flows. Many different assumptions would go into the construction of the financial models used to make the case for a legitimate valuation.
Arguably the most difficult aspect of building these models was synthesizing several hundred page market opportunity and analysis reports provided by various consulting firms. Being able to pull out small pieces of data from comprehensive reports, and then make a valuation case based on it. This, of course, could only be done by spending hundreds of hours “deep in the weeds” with excel. After performing valuation due diligence came the hard part.
I had to present my research findings to the managing directors, principals, and general partners of the firm. Not only was it an intense intellectual exchange, but I also had to show deep conviction concerning the metrics I used. I realized that even in an extremely technical industry like high finance, the art of selling was extremely important. To be honest, going into the internship that was not something I was expecting. I think Pink’s point about us all being “seller’s” could not be more true. I look forward to further developing my selling skills, as I’m sure they’ll be used often as I move through my career as equity research analyst.
BoweryJE22