WSO Podcast | E243: Wharton Undergraduate Finance Club Q&A
Patrick does a Q&A with the Wharton Undergraduate Finance Club.
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WSO Podcast Episode 243 Transcripts:
Patrick (CEO of WSO): [00:00:06] Hello and welcome! I'm Patrick Curtis, your host and chief Monkey. And this is the Wall Street Oasis podcast. Join me as I talk to some of the community's most successful and inspirational members to gain valuable insight into different career paths and life in general. Let's get to it.
Nicholas: [00:00:29] How to get started? Thank you, everyone for coming. So today we are lucky enough to have Patrick Curtis here. Mr. Curtis graduated from Williams College in 2002 and went straight into investment banking as an analyst for Rothschild and company. He then became an associate at Tailwind Capital working in private equity and in the same time he founded Wall Street Oasis and then obtained his MBA from Wharton in 2010 and a concentration in entrepreneur management. He's now working full time at Wall Street Oasis as CEO and founder and he will be moderated by Marco, who is my Co vice president of Events and Wolf and will be moderating the discussion following this. There will be a opportunity for Q&A. So Marco, you can go ahead and begin.
Margaux: [00:01:10] Thank you very much, Nick for the introduction. And thank you, Mr. Curtis, for being here with us today. So I'd like to dive straight into it and start from the beginning of your career. So first of all, why did you choose to work in finance and start with investment banking especially?
Patrick (CEO of WSO): [00:01:27] Well first off, thanks for having me. I think before I get into answering all the questions, just want to say I'll try to keep it very straight and honest with all of you. Want you guys to get a real perspective and not a sugar coated perspective. I have nothing, I have basically I love just being very straight. And so I'll keep it 100% honest in terms of why real reasons. We can start with this first question Why did I choose to work in finance? And especially, I really didn't know what I wanted to do. Williams College had a pretty good. As for a semi target small liberal arts college pretty good feeder into Wall Street into banks surprisingly. And so I remember I think it was like junior year. I would have been way too late if it was nowadays but I think it was junior year and someone was like. Oh, what about investment banking? I'm like, What's that? Completely different Like ballpark of how ready you guys are. But it seemed interesting, like interesting work. It seemed like I was like, Oh, it's you know, long hours. I can handle that though I was, you know, I worked long hours before I did a lot of homework.
Patrick (CEO of WSO): [00:02:30] It couldn't be that bad. I’d be especially just because that's what seemed to be the most like rigorous and competitive. And that's kind of how I was and thought, This will be interesting, It'll be challenging, I'll learn a lot because I don't know any finance or accounting since I'd never taken any. So it just seemed like a great place to be. Plus, I didn't want to depend on my parents for supporting myself. I wanted to live alone. Yeah, all those reasons kind of probably similar to why some of you may want to go in but you can't really say in your interviews. Yeah, you know to be honest, to be fair the pay is great but just like living in New York, being able to learn a lot, really fast was appealing. So that's kind of why I went that way. I think if Williams had been more of like, Hey, you should do comp sci or like everyone's doing. Computer science or computer engineering maybe would have gone that way. But it just wasn't the case. It was kind of like who I met and was an economics major. So kind of was a more natural progression to finance. So I think that's probably the simplest answer.
Margaux: [00:03:32] Well, thank you very much for that very honest. So I guess my next question is what made you switch from investment banking into private equity? And what was the biggest surprise that you faced during that change?
Patrick (CEO of WSO): [00:03:46] Yeah. So I think it's important to note in the introduction it was, I think maybe Nick got it from my bios and whatnot and it's not everywhere but I went actually from investment banking to private equity. But I went to a private equity shop in Boston and ended up getting fired four months later. So people don't know. Not everyone knows that about me. And so like I'll talk a little bit about that because I think it's more interesting than just the switch or the switch was. Again, I was late. I was on cycle recruiting like you guys know about on cycle. Like if you get a banking job you're going to get out of training. You're going to be hit immediately with like this crazy weekend extravaganza of like all knights, like recruiters calling you and you interviewing at all insane hours. Just this insanity that I wish didn't exist but does because some pretty bad incentives and game theory going on. But why I made the switch from vessel banking to private equity again my like think my second year in banking. I had a fellow analyst who was like, so what's your plan or what are you doing? And I'm just like I was sleep deprived. I said, I don't know. I don't know what I'm going to do. I guess I can't do this much longer. I don't know what should I do. And he's like, You should go to private equity.
Patrick (CEO of WSO): [00:05:01] I said, well what's private equity? This is, I'm not kidding, liberal arts. So give me a call, a little slack for not knowing what I was doing. But he told me about it. He kind of gave me some material saying like, this is how they're. This is how they're generating returns. And I was like, okay study this. Started interviewing in my second year of banking. Struck out a little bit. You know, I was at Rothschild, I was doing mostly restructuring. So I interviewed at some hedge funds and like they're distressed, like distressed credit type funds, which seemed interesting but eventually ended up at a PE fund in Boston. So I was super psyched. I was like, I made it. I got to the buy side. I'm at my dream job. And I think at that point I was actually pretty good at interviewing simply because I actually had done a ton of work at Rothschild and had done a lot of complex modeling so I could speak to that. And so I think what I'll say to like all of you here at Wharton. The expectations are super high in terms of like, what bank am I going to get? Like you should really care a lot more about like what group you're going to and the deal flow that you're going to get. Because if you get great deal flow and great experience it's so much more valuable than just the brand on your resume.
Patrick (CEO of WSO): [00:06:09] Because when you get into those interviews like you're the way you can communicate about that is just so much. It just sets you so much further apart from other candidates versus like the brand name may get you the interview but there's other ways to land interviews. So yeah, I switched because I couldn't really. I just couldn't handle the hours anymore. I think if I hadn't found anything, I think I would have stopped and needed a break anyways. I was with a managing director who's pretty notorious for really grinding his team. I learned an insane amount in like the first year but I was definitely like on a near nervous breakdown by like year and a half. And I was like on fumes by the end of the second year. And I remember when I told my VP that I was moving to private equity, he was like. He's like Oh, you shouldn't do that. Or and then he asked me later, he's like, how much? How much to stay? And I'm like, No. I'm basically thinking in my head, I'm like $5 million. Maybe I could do another year. Like I couldn't. I like literally couldn't do it like it wouldn't it wasn't at that point really about money. It was really about like health. And so that's why I switched. It seemed like really interesting. Private equity seemed like really interesting work.
Patrick (CEO of WSO): [00:07:24] I just went to the wrong fund initially. I think I went to a fund. It was very strange going from a place where, like you're told, like when you can go to the bathroom, like with like an associate over your shoulder to literally nobody talking to you for like a whole week. And it was a small office but it was more like everyone just was in their own little like pod like 2 or 3 people, smaller deal teams and. It didn't have that like bullpen camaraderie. It was just a very strange switch. And it turns out I got fired. I didn't know why at the time. It was a pretty tough conversation because I went into the room thinking I was getting a bonus. And then they're like yeah it's not the fit's not working. And I'm like, What the hell is going on? I'm like, Is this really happening right now? And so they tried to get me to sign some sort of like waiver. Hey, you take $10,000. I'm like, I don't need the 10,000. I'm like, What's going on? So anyways long story short I ended up interviewing at a bunch of places in Boston. The recruiter at one point was like, I don't know what's wrong. You're I got to like all these final rounds. He's like you're blackballed from like private equity. And I'm like, okay this is really messed up. Like my career got completely derailed at two years in. Ended up getting the only reason I ended up getting a job at Tailwind was because of a fellow analyst, Jason Shear who worked with me.
Patrick (CEO of WSO): [00:08:39] He's now like a partner at Apollo or something crazy but he worked with me at Rothschild vouched for me at Tailwind being like. Oh no, Patrick works crazy. Long Hours is hard work and he's sharp. So he's the only reason I ended up back on my feet at Tailwind. And so I worked there for three and a half years. But like, I think that experience of getting fired is kind of why Wall Street Oasis even exists because it was almost like it totally threw my whole framework of like work hard put your head down everything's going to take care of itself. And it's like no actually I think it's, actually really similar to like what's happening today. And people are like realizing like, it's actually not that safe of a place. And sometimes things way out of your control no matter how good you are or how hardworking you are is, it is out of your control. So for me I think that's why switch. And the biggest surprise was that. It wasn't things weren't going to take care of themselves like you had to take it into your own hands in terms of what you did for your future. So yeah, that's kind of long answer to that question.
Margaux: [00:09:45] Well, thank you very much! So guess what? So for what reason did you decide to pursue an MBA?
Patrick (CEO of WSO): [00:09:52] So the MBA got the sense that tailwind that if I wanted to even ever move up a lot of them had the MBA. So like got the sense they wanted me to go back. You can kind of read between the lines of like. Hey, what's your plan for like after a couple of years? And I think every other principal and director there had an MBA. I basically was going to get pushed out after probably 3 or 4 years anyways there or go get an MBA. And so at the time had started Wall Street Oasis at in oh six, so it had already grown to be not huge but like it was like a million page views a month which can't really feed a family but it could maybe feed one person if you're kind of careful. And so I thought to myself there's probably something here. If I have a couple of years go to school. I have the option of potentially going back to private equity or if this actually does grow enough if I can monetize it a little bit more it's potentially something I could do and run with.
Patrick (CEO of WSO): [00:10:55] And so my reason to pursue the MBA was really to see if I could have a little bit more runway to grow this business with kind of the cover of school. And then obviously an MBA from Wharton isn't a bad kind of insurance policy to have should things not work out. So I think for all those reasons, I think again being around like incredible people and to be honest it was a great decision for me because when I got there the people that were in my cohort the people that were like helping me were like people who had like run ads like knew how to like set up their. Like what are you doing? This is all wrong. Like you should have these units here and there. And so they really helped kind of just dramatically change the trajectory of the business right away. Like within the first few months of me being at school. So I think for that reason alone. It was that reason alone it was worth it.
Margaux: [00:11:48] Thank you! So we already talked about it, but what led you to found Wall Street Oasis?
Patrick (CEO of WSO): [00:11:54] Yeah. So it was partly I think that discomfort of having been fired early in my career and knowing like well I probably want to have something on the side just in case that happens again or for whatever reason we enter into a deep recession. And so when I think the other thing that actually like really pushed me to do was it's kind of embarrassing but kind of funny. I read like some Forbes 30 Under 30 article and it was like all these businesses and it was like. I remember what struck me about reading all of them is like a lot of them were these tiny little businesses. I'm like this is the Forbes 30 under 30. I'm like this is kind of like none of these are the next Google. A lot of them are really niche small businesses. And they kind of struck me like I can just do something like that or something online. And then I figured like, what do I know? Well, I don't know much. So maybe something around investment banking and community. In that community and so that's how it started. Yeah, that was it.
Margaux: [00:12:47] Yeah and what was the greatest challenge you had to face in the process of creating Wall Street Oasis and being in university in the same time?
Patrick (CEO of WSO): [00:12:55] Yeah, well initially I went from what like 90 ish hours a week down to about 50, 60 hours a week at and at tailwind. So it felt like a vacation, felt like I had all this free time. So working 10 to 15 hours a week on this on top of my full time job before even going to Wharton didn't feel like it felt fun. Like it was actually really exciting to see people communicating getting value out of the platform even before it made any money. That was awesome. So the greatest challenge was definitely early on like the first few years when there wasn't much money coming in but I still needed some help on the development side to like get basic things working or fix them. I still think it's still a challenge because I'm not. I don't have a technical background so having developers that I really trust I think helps with that. But yeah, I think just surviving those first few years and not. Just sticking with it I mean, think for me because it was my own thing. It just made it easier to stick with it. I don't know. You know, think after you go to banking and you work that many hours for somebody else like working at 20 hours for something that makes like barely any money. It doesn't feel that bad because at least it's yours, you know?
Margaux: [00:14:13] And would you say that this would, like what is the scariest part of creating Wall Street Oasis?
Patrick (CEO of WSO): [00:14:21] Like running it day to day or like when I was creating. I mean, I wasn't like some risky entrepreneur where I quit everything and like went out. Like you got to think like I had three years or two years prior to Wharton then I had another two years to run it and grow it before. I had like four and a half years before I was really. Taking a leap by that point. Yes, it was a pay cut coming from private equity. If I'd gone back to private equity I would have made more. But it wasn't like a dramatic. It was like a 30-40 percent pay cut instead of a 80 or 90 percent pay. It wasn't like I went and was making suddenly like $20,000 a year and having to somehow survive. It was like, okay instead of making whatever $300- $400,000 out of business school. I'm going to make 150-20,000 but then I'm totally free. So for me that trade off was pretty easy to make because you also have all the upside associated with like building something. I don't know. I just think that the scariest part of that leap was definitely just like, what if it doesn't work? What if in 2 or 3 years for whatever reason SEO doesn't work? Google makes things harder and Google has made things harder for us. And I can talk to that a little bit but I don't know if we want to get into technicals of SEO but I think the scariest part was just that is like what happens if in 3 to 4 years it goes down for whatever reason we can't grow it and then can't get back into private equity because now I'm stale, I'm like old and like now it's like that ship has sailed so far. Like, I think if I was ever to go back in anything else I'd have to work with like startups and do that type of stuff because it's that the traditional finance role has I think is very far gone. But yeah, I think that's probably the scariest part of making that jump.
Margaux: [00:16:09] Well we said that worked pretty well, indeed. Is there something that keeps surprising you every day?
Patrick (CEO of WSO): [00:16:17] Yes. What surprised me there's like, partners managing directors VP's on the forum actually like giving advice for free for like hours a week. That's still shocks me for all. For silver bananas and virtual currency. So I'm just like I think a lot of them just kind of crave giving back and it's an easy platform to do that anonymously. So I think that's the cool part. But it does surprise me sometimes. I guess it's a small fraction of the community base but they are there. And so like some of our top members. They've been around for a lot, have been around for years and they keep coming back to give great value. And so I think that's always been really surprising. Even from the beginning. I'm like, who are these people and why are they like helping so much? And I think I get it now. It's a lot more than just, you know. The people getting the value are not just the people receiving the advice. It's like the people giving the advice feel good too.
Margaux: [00:17:16] So talking about the platform, how do you promote a positive culture on a forum that could involve more controversial subjects?
Patrick (CEO of WSO): [00:17:24] This has been probably one of the most challenging things besides the dev side is moderating a group of 18 to 20, basically 18 to 24 year olds that are anonymous, It is a nightmare. But a lot of levels, so I think promoting a positive culture. So like you can have as many terms and conditions around like speak with respect, treat people how you want to be treated, talk as if you're, your name is going to be associated with it. And I think for the vast majority of members that's what they do. However when you introduce the level of anonymous posting. What happens and there's kind of two layers of being anonymous, right? There's your username which people can be anonymous and then there's also anonymous posting. So what happens is like you get people, who kind of wouldn't say things to your face that will say things that end up being really toxic. And so we've had to kind of throughout the 16 years we've been doing this. There's been like almost like a cycle where things will get like, things will be fine and then things will kind of degrade and you'll have like anywhere from 5 to 10 members that are constantly on the forums trying to turn every discussion into an argument or into a political discussion or into something controversial.
Patrick (CEO of WSO): [00:18:49] And then there'll be like two people going back and forth on this like sub thread. And so like I think what we've found is we have a much better system in place. So we've, we started off doing like all manual then we started using some like automated tools and now we're using a lot of automated tools with a with a larger team on top of it. So now we have. Basically a screener, there's like some screener that reads every single post before it even hits a human. And it'll, it won't remove anything but it'll flag potential violations and with like severity scores on it. So that's been really helpful. And that was only in the last like year and a half, I think we released that. So I think that's helpful because I actually really value the controversial subjects and I think I've learned a ton just by reading the differing opinions in the forum. So I don't like to remove them. I like having that debate back and forth. I just hate it when it gets super bass level and like disrespectful. And unfortunately, when you're talking anonymous like it usually goes there pretty fast. And so like that, unfortunately we do have to remove a lot of them.
Patrick (CEO of WSO): [00:19:59] We try sometimes to let them stay up but what we call no bump that we'll let, we'll like make it so that it doesn't keep getting bumped to the top. It will let it float. So people who are having an interesting discussion that may be a little bit offensive to some people, sometimes it'll stay up longer. The problem with that is then maybe like months later. Somebody says something really bad that wasn't flagged or our mod team missed. And so we'll occasionally have stuff in the archives that I'm like, how did that like, that's horrible. Like get rid of that. So yeah, it's hard. But think in terms of promoting positive culture just continually trying to like lead by example get the really bad stuff off as fast as possible. And then yeah, just like in terms of how we're sending the violations make sure you're clear in terms of why it was a violation communicating that way. And so it's just taken a lot of investment on the tech side. And then on, the on just the Mod team side to be able to do that, because we have like a ton of shifts now throughout the day because there's hundreds of flags that come through every single day. So it's a lot.
Margaux: [00:21:01] I guess talking about subjects. On a more personal note, what is your favorite Wall Street Oasis thread of all time if you have one?
Patrick (CEO of WSO): [00:21:09] I think one of the funniest and one of my favorites is I think there was a thread where someone said I'm in eighth grade, is it too late? Am I too late for PE recruiting? And then everyone started talking about like target elementary schools and like middle schools. And it was really funny. And they got yeah, I think that's probably my favorite. But there's a lot of like useful ones too that are great. There's a lot of like stories of people who like broke in. They were like homeless and then they broke in like stuff like that, super inspirational. So it's hard to pick just one, but probably one of those.
Margaux: [00:21:44] Yeah, we have our personal favorites about the ranking of watching clubs as well. So that's a big one on campus.
Patrick (CEO of WSO): [00:21:50] Oh, the war. Yes, I Remember that. Yeah, I remember seeing that. I don't even remember what it said. So sorry if it was offensive to you guys.
Margaux: [00:21:58] No, not for us. Not for working. If you had to go back and start everything over again, what would have you done differently for Wall Street Oasis?
Patrick (CEO of WSO): [00:22:08] It's a good question. I think I probably would have. Hired more a little more aggressively earlier coming from restructuring think was like very scared and tainted like all these businesses going bankrupt. I'm like kind of frames your perspective and trying to grow a business from like this, almost like a scared position. It's good because it keeps you like casual positive and all this stuff. But if like you don't actually invest and think higher quality people, and higher quality skills, higher quality consultants to come in and like just tell you everything you're doing wrong your growth is a lot slower than what it could have been. So I think that's probably the only thing I would have changed. Like I think overall it's been great. But I would probably just like bring in some people that know a lot more than me earlier and tell me everything I'm doing wrong. And we're still doing a lot of things wrong but at least I feel like we're a little bit more knowledgeable about that now. And it's more about just getting the right people like the right skill sets and the right team. Like we need a UI UX designer, we need to get a mobile app better. I know all these things. It's just a question of actually getting the right skilled people in place.
Margaux: [00:23:14] Yeah. So now we're going to switch on more of the recruiting side as you are the master of this subject. How can students at Penn best prepare for the professional life after graduation?
Patrick (CEO of WSO): [00:23:28] Yeah, so I think for this. Professional life like they don't teach you. They teach you like the modeling skills, Probably. You guys know all that stuff. The accounting, I think professional life like they don't teach you much and think Weiss talked about this when you guys had them talk. Probably he touched on this but like the skill set of like soft skills and being able to have a good conversation and making relationships with people. It's just going to serve you so well. So like, even if you're like the technically strongest analyst the best modeler it really doesn't matter at a certain point. And so it really can set you apart, like, how good are you with clients, How good are you at just at small talk and like can you make people laugh? Do you have skills there? Like are you I don't know, Are you fun to be around? Like so when I think one of the things. That said there were some other question here later that said like what's the most important thing for like how to best I'm like, no like have interesting interests on your resume is almost like more important than especially for you guys where they're like, you can cut the difference with like a knife. Like there's, it's so hard to know who to hire. So like they could hire any one of you and you all do a great job.
Patrick (CEO of WSO): [00:24:41] So like, the question is more around. Who do you want to be with? Who's most interesting? Who has the most interesting skills? So I think those can really set you apart. And oftentimes it's a secondary thought that goes at the bottom of a resume. People are like running poker or whatever. I don't know, they put something like reading books instead of saying like something more specific, more interesting that'll kind of set you apart and brand you. So like, in terms of preparing for your professional life after graduation. Think just keep talking to people. One of my mentees, Grace from Fordham, she did so many like informational interviews and calls with people that she's incredibly well-spoken and like I have no. She's already a it's like she's a senior, but it's like she's 2 or 3 years more mature as a result of that of all those calls. And so like I'm sure all of you are doing that or most of you are probably doing that but don't underestimate those skills and don't put like the technical skills ahead of that because at a certain point it's modeling is modeling. And like most people can do that especially with even the liberal arts majors like me could catch up after six months. And your differentiation isn't going to be that. It's going to be the other stuff.
Margaux: [00:25:55] And I would say that also applies on how to best prepare for interviews, right?
Patrick (CEO of WSO): [00:26:01] Yeah, absolutely and like so many people jump straight to the technical interview questions because they're scared of that brain teaser. They're scared of that like really crazy accounting question that they may get asked when their answers to tell me about yourself, why I be and why this firm? Those three questions they're great but they're not exceptional. Right, and so like you think to yourself like, who's going to get the offer? It's not the people with the great answers. It's not the 95th percentile that gets the offer. It's the 99th percentile that gets the offer. Well, maybe actually at Wharton the 90th percentile probably the top ten. You guys probably are an exception to the rule. But like for most people you need to have the 99th percentile answer and those three questions you basically know you're getting. So the problem is a lot of college kids, I'd say you guys are probably more well versed in prep but a lot of people at other schools don't have the resources that you have and so they think their questions are exceptional but they're a little more like great answers and always know like you need to be exceptional like it needs to be really just like dialed in and tight and like that whole answer to all of that stuff. It doesn't mean giving, making it like super like you're born to do this job or anything like that.
Patrick (CEO of WSO): [00:27:10] It's more around being specific around, why the specific role is interesting to you? And it being a little bit more than just like the generic answers of like I want to work around smart people and. You know what I mean so it's like it making it more personal and making it a little bit more like. Oh wow, that stands out that answer. So I'd say the best way to prepare for interviews. Sure, you can drill on the technicals but like don't underestimate those three questions and those three fit questions. And then don't underestimate the mock interviews and the prep for the other kind of tricky fit questions around. Tell me about a time when you had a conflict with a team member. Tell me about a time when you. Like those and being able to map them to your stories really quickly. And so you're only going to get, you're only gonna get good at that if you just practice with like a bunch of bunch of mocks. So I'd say at least five before your first real interview, hopefully. So yeah, that's what I'd say.
Margaux: [00:28:11] Yes, that reflects a lot the importance of finding your story to tell recruiter.
Patrick (CEO of WSO): [00:28:16] Stories here. Yeah, it's everything. And people underestimate it because they're more scared of the technical questions because it's easier to get a good answer on the fit, right? It's easier to get to a good place on the fit. Whereas the technical it's like right or wrong but like people got to you have to think of like a good answer to your fit as a wrong answer. It's like getting a wrong answer on a technical question. That's like the level it's hurting you and then people like will change their framework. So that's what I tell people.
Margaux: [00:28:43] The more technical side. But would you say that how the skill set of somebody that's in investment banking is going to diverge from somebody in a hedge fund or private equity? Do you find the difference in mindsets, interests and long term goals?
Patrick (CEO of WSO): [00:29:00] Yeah, think IB is really more like you can think of it as like more foundational valuation skills. Typically modeling skills which are all great for private equity and hedge funds. I think the difference really comes in terms of like what you want to, like what's your personality in terms of like stress level, day to day type of work. Whereas like PE, it's definitely a little bit more of a slower pace getting to know management teams a little bit more of like the, they're both investor you have to have the investor mindset with the hedge funds and the PE, but hedge funds it's a little more fast paced a little bit more like your you have your score basically right there. And so you're working with a PM. They're still kind of that mentorship network. So it's not like just you and until you become PM but it's still almost like you're expected to. Develop that skill set pretty fast. Whereas PE I feel like yes, you're expected to perform at a high level but it's a little bit easier coming from IB because it's like okay, now you're just doing models and reading through Sims and putting together investment committee debt memos and doing diligence looking of QV reports and all that stuff.
Patrick (CEO of WSO): [00:30:11] So it's not like, I feel like it's a little bit of easier transition where it's hedge funds is a little bit more like, do you have the stomach for the markets? Do you like, are you going to put, do you have the confidence in yourself? And do you have like the actual stamina to do that research that deep analytical research? And do you love that? And so like. I'd say hedge funds probably a little nerdier, a little bit more like they like to be a little more introverted. Maybe they like to really go deep into industries and like and look at that in terms of like valuation, whereas private equity it's a little bit more. Yeah, you have the model but that's like super easy in terms of like the modeling and it's more about management team a little more like a consulting skill set where like. Okay, you're looking at like industry dynamics, the capital needs of the business, that type of thing. So yeah, different mindsets. Maybe like, maybe more short term versus long term. Private equity, obviously hold times are 3 to 7 years plus. Hedge funds can be anywhere from like a few days to months but usually much shorter than several years.
Margaux: [00:31:25] No, it's great to know from somebody that actually experienced the different industries. Do you have any advice for choosing between different coverage and product groups?
Patrick (CEO of WSO): [00:31:36] Yeah, actually I was reading, I read this question, I was reading a little bit of like what people were suggesting on the threads. And there's some great advice on WSO for this but. Product groups think are great if you know like you want a kind of a broader skill set like you're going to see a lot of different industries. It depends like if you're like in M&A, it leads really well into like a private equity job or buy side if you're in financial sponsors that too because you're exposed at least to that side. But if you're like in equity capital markets, debt, capital markets, it's a little bit harder because you're just kind of doing that one service. Like you're getting exposure to a lot of industries. Which is interesting, I would say in terms of like choosing. I'd say probably product, you'd want to go product if you could choose or just be in a. Being a coverage team that has a lot of deal flow. So at least you're getting good deal flow and I think that's going to be the most important thing rather than being coverage or product because all these banks are all the top banks that you guys are going to be going for. Like they all have great training. They all have pretty good exit ops and all that stuff. So the other thing is like you might actually want to stay in banking. Who knows? Maybe the pendulum has swung too far into the private equity. Maybe because like I know at least in 2021 some of the, some of what I was hearing in terms of like pay packages for these third year analysts was insane.
Patrick (CEO of WSO): [00:33:04] And they were trying to be like, take a vacation. I was like. What is going on here? The world is upside down. But so it you got to think about like the demand for talent. Obviously things have swung a little bit more to being a more difficult environment. Currently, with all the interns potentially losing their offers. A Credit Suisse we don't know what's going to happen but assume. That's going to be tough. Tough lateral market right now tough internship the full time the intern to full time offer is probably much lower this year. I was just looking at the stats and one of the live streams I was doing on LinkedIn and surprisingly like they're really high, like for a lot of the bulge brackets and boutiques they're like in the close to 90% it was like 80 to 90% for a lot of the top banks. A few of the bulge brackets tend to be a little under 80 but I was saying like this year you might want to like shave 20% off that. So like if bank was doing like 80% maybe it'll do like 60 to 70% this year in terms of offer rates. And then the ones that were doing like 70% maybe more like 50 to 60%. But yeah, that's kind of my advice for coverage for products. Sorry it's not more specific, it's tough for me because I was. It was so long ago and I was restructuring. So it's like head down and but there's a lot of good discussions on that exact question. If you just do product versus coverage WSL and Google and you'll find like 20 discussions on it.
Margaux: [00:34:32] No. It's a really good overview. I guess I'm putting you on the spot on that. What do you think is the future of investment banking? I know that was why she talked all about it.
Patrick (CEO of WSO): [00:34:43] Yeah, future for investment banking in terms of like junior analysts and the life for junior analysts or for analysts. So I think there is a push to try and make the work life balance better. I just don't know if it's going to move fast enough to make really any dent in the attrition problems that we're seeing, especially like Covid just accelerated a lot of the people like just getting fed up and leaving. So we have actually a work life balance survey that we usually do every year and I think we're a little behind. We got to get that out this year. But I'd be interesting to see this will be the third year and it actually got better from 2021 to 2022, but it wasn't good. It was still bad. It was just slightly better. So it'll be interesting to see this year if things are trending even better. It's tough because when there's cuts in the industry, what ends up happening is like you're still pitching a ton. So even if you're not doing a lot of deal work you're still having usually like late nights and stuff like that. So it's not as if there's ever really a lull. If you have a bunch of MDS and partners like trying to drum up business because it just creates a ton of work. So I think that's the hard part is like it's a sales business as a client oriented business.
Patrick (CEO of WSO): [00:35:57] And so it's very tough to tell somebody when you. Hey, we're paying this fixed resource, this analyst we're paying them X. But you can't use them or you can only use them on these days or this. And everyone's like clamoring to build their business. And so you can think of like a partner's business or an MDS business in a bank as like their own entrepreneurial venture. And they're just, they're hanging their name in there and they're trying to everyone's trying to grab for the same resources. And so the pressure is felt by the analysts and the associates primarily. And that's why the work life balance and I don't know how you change that dynamic if anyone has like a solution. Oh, hire double the number of analysts, guess what? The pitches will go up by two X and you'll be back to where you were or it'll be, you'll be cut in half and it'll just be still long hours, probably long hours. So maybe not as bad but I think the other thing that's really hard is like actually projecting in terms of what the deal flow is going to be at any given time. I mean, people didn't predict Covid and then there was like a deal frenzy and then everyone was just drowning.
Patrick (CEO of WSO): [00:37:03] I remember talking to some associates during that time and they're like. I can't do this like I gotta get out just because like they weren't even sleeping and it was all live deals. So anyways yeah, I think I don't have a positive feeling in terms of where it's going because I don't think there's any incentives for the banks any dramatic incentives for the banks. I don't think at the top there's not enough like we need to completely change the dynamic because I don't think there's a solution that actually solves it. Until you actually tie the pay of the MDS to like analyst satisfaction like work life balance satisfaction or something like that. Like there's just no incentive to suddenly be like, well you know what? I'm going to let Sally over here. Who's my fellow MD get double the amount of analyst hours so she can pitch three extra clients and make an extra million dollars. Because you know what? I want to make sure these analysts sleep an extra hour a night. Like it's just not going to happen. Like it's just and especially with the mentality of like a lot of them went through it themselves and some you still have some of that like well I went through it like, yeah.
Margaux: [00:38:22] I guess we shall see Now.
Patrick (CEO of WSO): [00:38:25] That's why everyone leaves. But that's why everyone leaves so fast and it's kind of a shame. It's kind of a shame because the work is interesting. Actually, it's really interesting.
Margaux: [00:38:36] I guess another hard to answer question. Do you have any advice for international students recruiting right now?
Patrick (CEO of WSO): [00:38:44] We talked about this before. We were recording. Yeah, I don't have any good advice except like be open minded and take what you can get because it's really tough. And you have a firm willing to sponsor your visa work. Your work visa is just take it. Don't try to trade up. You get a lot of people, especially from Wharton. Sure, you guys have are going to have multiple offers. You may retrade some of your offers renege. I would be very careful with international student trying that. I would just put your head down and try your best to get good, get some good deal experience on your resume and then yeah, that's it's not easy for all of you.
Margaux: [00:39:24] I will not negotiate indeed my salary now.
Patrick (CEO of WSO): [00:39:27] Yeah, take the job.
Margaux: [00:39:30] I'll just take the job.
Patrick (CEO of WSO): [00:39:32] No, Negotiating pay at this level is just like It's really silly.
Margaux: [00:39:38] I don't think our negotiation teachers would be really happy to hear about that, but yes.
Patrick (CEO of WSO): [00:39:41] But yeah, it's negotiate when the actual like negotiate on the transitions. Well from job to job. They're absolutely like be really aggressive. Anchor super high, do everything your negotiation professor would tell you to do. Other than that when your first job out of school, like get the job, get the experience under your belt, build the CV, and then you're in a really good spot. If you have that after two years, you can like go anywhere. You can do whatever you guys want, you can do whatever you want. You can go Corp Dev, Corp fin, M&A, internal M&A, you can go start ups, CFO, chief of staff. You can do like really cool jobs. You can just go, you can go PE obviously hedge fund. There's just so much you can do or you can just like go reinvent yourself, go to become an entrepreneur, go become an e-com, open some e-commerce stores on the side while you're sleep deprived. And I'm just kidding. While you hopefully aren't sleep deprived and hopefully you have a little bit more work life balance. But yeah, I don't know if that's helpful.
Margaux: [00:40:48] So it is really good to know. So last question before opening it up to Q&A. What is the one piece of advice you would give to your younger self?
Patrick (CEO of WSO): [00:40:59] Don't take where you end up right out of school so seriously. Like your first step so seriously. Super long. Like you guys have a ton of time. If you fail, if you don't get into whatever. This is especially true for you guys because like it's such a hyper focused environment in this club especially, it's like everyone's like. Oh, that person got this and this person got like, who cares? Like it's a long career. It doesn't really matter where people start. Eventually, if you're do good work, if you're great to work with and you're a hard worker, you communicate well. You're going to like find you're going to end up in a great spot. So I would just say that like this first it's just very focused because like you guys are super young so like that's all you know and this is the first job. So it's like it feels like a big deal. But like in six, seven years after you graduate, you'll look up and be like oh my gosh, Like I thought the world had ended because I didn't get into here. And I got I ended up at this bank or I did this and that, and it really won't matter for like 99% of you It really won't matter at all.
Patrick (CEO of WSO): [00:42:03] So I'll just say like keep perspective there. Don't put so much pressure on yourself to feel like you have to get it right this one time. People reinvent themselves all the time. I have people on my podcast all the time who start out like nowhere near where you guys will start and ended up at the most incredible places, incredible firms, because they proved through their work that they belong there. And so I think that's a lot more important, like you guys are going to get a lot a great shot early on but that also doesn't guarantee anything like in 3 to 4 years. So that's all I'd say is like, don't take it so seriously. I'd say to myself like the first few years out and don't panic. Like if something bad happens, like would happen to me don't panic. Because like I think if you have good relationships with people and they know you do good work like you usually end up on your feet.
Margaux: [00:42:57] Well, I think this is especially very important for all the sophomores here that recruiting and stressing over offers right now.
Patrick (CEO of WSO): [00:43:03] And yes, your sophomores come on. You can come do our research internship. We have an internship, you can come do that with us. If all else fails, you can come do that. And then people will be like. What's this weird Wall Street Oasis internship? And then you'll end up talking about that during the interview and it's a lot more fun.
Margaux: [00:43:21] Well, thank you very much for answering the questions. Now we'll be opening it up to Q&A. So this phrase online, Joanna.
Patrick (CEO of WSO): [00:43:31] Do you want to call on people Margo?
Margaux: [00:43:34] Yes, I can.
Joanna: [00:43:36] Yeah. Hi Patrick, and thanks so much for coming to talk to us! And thanks Margo! for organizing this talk. So I know you were talking about how perhaps it's not so important what your first job is out of undergrad. I wonder if you might have this an opinion for working outside of the US market. Do you think it also doesn't matter as much whether your first job is US based or not?
Patrick (CEO of WSO): [00:44:01] That's a good question. I think it becomes, I think it's less important early on. I think as you get further along, to that associate level like that second title, if you're in a Internet, if you're in a market outside the US, if you continue to kind of build that network that professional network outside the US, it will start getting harder and harder. We were just having a discussion about like Dubai. There was an interesting thread about working in Dubai and it was like talking about like at the VP level. By the time you get to the VP level, it's very hard to transition back to Europe, for example. But if like the analysts at the analyst level, if you're at a big enough firm it's very easy to transition internally like back to the US. So it kind of depends on the firm. It depends a little bit on like how long you're talking. But I think if you want to go work in London, work in Hong Kong, working wherever for a year or two, I don't think it's that limiting.
Joanna: [00:44:53] Okay, got it. Because a lot of the advice I'm receiving is just try and work abroad for like 1 or 2 years. But then I'm not quite sure, like when is the best time to work abroad?
Patrick (CEO of WSO): [00:45:03] Early yeah, I would say earlier because then it keeps your options a little bit more open. It's kind of like, Oh, you wanted to see more. So like if you're going to do it becomes it's easiest to do it earlier. Yeah, and but more important than that, like I think the work you're actually gonna be doing is what's going to matter like. So like it'll be easier to stay in that same kind of field. And like so if like you suddenly are like working in Fig at some bank in London it's still going to be hard to transition back to the US dot because it's coming back to the US. Just because you worked at Fig and so like you'll need to find a place in Fig most likely to get the transition, you know? So like think of more like the work experience and the actual day to day as what matters more than like the geographic location.
Joanna: [00:45:43] Okay. Yeah, that makes sense.
Patrick (CEO of WSO): [00:45:44] Especially if you have citizenship here in the US and stuff. So like it's an easier transition back.
Joanna: [00:45:50] Yeah. Thank you!
Patrick (CEO of WSO): [00:45:51] Yeah, no worries.
Margaux: [00:45:53] So we have a question from David. I don't know if he's able to put his camera on.
Patrick (CEO of WSO): [00:45:59] It's okay. Yeah, see the. Could you talk about Google's changes? How it's more difficult? That's an interesting question. I could go on and on this one. I could do a whole lecture on SEO. No, yeah. So back when we launched 2006, SEO was very different. And just the way Google kind of divvied up traffic to different websites. So obviously most of the content on Wall Street is user generated content, right? So if you think of like a website and like all the different URLs below it. Google used to rank each individual URL kind of distinctly. So there wasn't like an overall arching domain score so much it's like. Hey, if this one thread or this one article or this one blog post just happens to be really good on the content side then that's what's going to rank number one back. And then starting around 2012, what started happening was they started a lot of forum based sites. Started kind of getting demoted in the rankings. So we saw some forums like drop 80% in traffic like overnight. Luckily that didn't happen to us like we were okay but we definitely saw almost like a cap that was placed on our traffic. So like we were like this going up and then it was like this and just flat. And so I was like, What happened? What happened? I started reading all these like horror stories of all these other forums that were like plummeting. And I'm like, Oh my gosh. So Google started doing a couple things. So the reason the forums didn't do so well is because there used to be like a concentration in the results.
Patrick (CEO of WSO): [00:47:26] So like if you typed in Houlihan Lokey interview questions like back in 08, 09, 2010, we probably had like the top like seven results and we would get like the top five or like whatever top seven results would be all Wall Street Oasis because it was like lots of discussion, lots of content, very top like very much on that topic. Whereas now like they wanted more diversity on the domain. The domains, so like instead of six results we were only getting 1 or 2. And then more specifically user generated content was demoted. So now they're really looking for expertise, authority and trust which is very hard to show for user generated content that is anonymous. So for us, so it's like it's kind of like shifted away from that. They wanted expertise, authority and trust. And so we've done things to help on that end. So we have a whole resources section now. Articles where we're putting like actual authors and bios and having it reviewed by like a content team and stuff like that and putting our bios up there. But in terms of how we're getting our traffic mostly it's still 80% SEO 80% organic search traffic. So it's still very much dependent. We're still very much dependent on that. Yeah, that's kind of how things are, that's a quick summary of how things have changed over the years. If you want to geek out more on it, we can talk over email.
Margaux: [00:48:40] So we have a question from Enrique.
Enrique: [00:48:45] Hi, Patrick. My name is Enrique. Thanks for coming out! Appreciate your time. Also share that same favorite thread of yours that you mentioned earlier. Unfortunately was not born at a Target hospital but I got so. So basically your experience in ibmp. I know you're mentioning earlier the coverage versus product group and how there's preference and all that when it comes to. Do you think that same argument applies to where middle market fund that's investing in growth equity in healthcare or in software? Do you think there's a preferable sector when it comes to PE?
Patrick (CEO of WSO): [00:49:18] I think whatever interests you the most it's going to keep you motivated, like coming to work every day and like being happy. I think that's probably what matters the most. Obviously tech's going through a pretty tough time right now. Probably growth equity in that space. But if it's really, if you're really passionate about it and really passionate about SAS or whatnot, I would say go for it. I would say probably some like the industrial. Based businesses those types of businesses a little more like traditional candidates maybe don't get as much love as they used to get and like they could be great places to build a career. Same thing with private credit which is kind of had a little bit of a some new growth with a lot of the mega funds released having larger arms doing that now. Definitely a place that's kind of under, underappreciated as a career. And I think a lot of the work can be very interesting there as well. So I'd encourage you to, I don't think it's going to just matter like more about your interests and you'll probably know more after like a year or so. And that's the other downside of having PE recruiting so early. If it's like some niche PE fund and you're not even really sure if you're interested in the industry it's kind of like you have to just guess.But I was talking to a, there's somebody at a I was talking to like an HR. I Think somebody HR at like one of these funds a couple days ago and they were talking about how they stopped was it Riverside or one of these PE funds middle market PE funds they said they stopped doing on cycle because they found like all these bankers were reneging on their PE offers like right before start day like a good third of the class was just like. Nah, decided to go do something else.
Patrick (CEO of WSO): [00:50:51] And they were kind of shocked. But yeah, that's what I'd say is like unfortunately it's early so you kind of have to like be like. Yeah, this is what I want to do. And what I'd say is like, just take the best offer you have and then try to learn about yourself as fast as you can to try not reneg last second. But to be honest like it's not fair to you guys to be forced like to be recruiting sophomore year for banking and then right away for PE. So I would do what's right for yourself. And as long as you're like changing paths and doing it respectfully. I don't think anybody's going to remember or care very much, to be honest. So just keep that in mind and don't think I know the world revolves around like what's in your head. And for all of us, we have that. We have that kind of. I guess, weakness of just looking inward and thinking everybody cares so much but like unless it's like a tiny PE fund that you're like. Yeah, I'm going to come join you guys. And they're like depending on you like for like they'll be okay. And there's a line of other people ready to like jump in behind you. So I wouldn't worry about that.
Enrique: [00:51:59] Awesome. I'll check out some more WSO podcasts and, thanks!
Patrick (CEO of WSO): [00:52:02] Awesome cool man. Thanks for joining!
Margaux: [00:52:06] Now we have a question in the chat from Amy. I need the glasses for that. What's the implications of the Credit Suisse fallout and learning lessons from IBD recruiting, thinking of Lehman Brothers, etc?
Patrick (CEO of WSO): [00:52:22] The lesson is don't just go for bulge bracket banks. No, just kidding. No the lesson. I mean, the lesson is that like it's not just about getting an offer, lessons just it's not about just getting one offer. It's about building relationships across firms across the street and think not that I was very good at this but the people that I mentor and the people that I talk with now I'm always like, you need to stay in touch. And it gets really hard when you're working banking but like think it's your network and not just laughing because it says Credit Suisse think but just. But like honestly like, the like if you have strong relationships at a lot of different banks. It's just so much like you have so much more insurance around something like this happening and being able to get into, the into like a process or like the lateral, a lateral job. I don't think anyone's going to hold it against you if, like you had an internship at Credit Suisse, you don't land it. And then so for that reason, I think you're probably going to get some looks but it may not be at a bulge bracket bank It may not be in Elite Boutique in like. That's okay, life will go on like it's okay. And so I think as long you guys are in a great position coming from Wharton. I think people are still going to want to hire you. So you just have to be creative. You have to be think maybe a little bit outside of IB. Maybe there's other things you could do that are interesting that kind of give you a similar skill set.
Patrick (CEO of WSO): [00:53:50] Whether it's startups, whether it's venture capital, doing some BC work. Maybe it's like a blessing in disguise. Maybe that dream job you thought you had. When you get one year in you'll realize, Did I really want this? And you'll have an existential crisis at 22 years old like a lot of bankers do. So they have like a quarter life crisis when they're 22 years old because that's what happens when you start working those crazy hours. Like you really start looking inward and like. Is this what I want? Because it seems like it's what you want because everyone else is doing it. But when you actually get in there and start doing it, it's really hard. So I just like be careful of like thinking the world is falling when you might not have even liked it and been trying to quit a year in anyways. Yeah, thinking Lehman Brothers. Yeah, think in terms of recruiting. Yeah, a lot of these things are totally out of your control. It's you just got to try to focus on what you can control. And Yeah, that's all I'd say. I think it's a similar lesson of just. It's a huge bank, probably a pretty big intern class that's trying to like figure out what's next. Right now, probably some of you even in this club.
Margaux: [00:55:05] We have another question from Joanna.
Patrick (CEO of WSO): [00:55:07] Sure. Joanna, go ahead.
Joanna: [00:55:09] Yeah, I'm just wondering. So I know you were talking about like some threads regret earlier on the forum. And I'm wondering what maybe some of the best piece of advice you have read are and some of the worst pieces of advice you've read are.
Patrick (CEO of WSO): [00:55:23] Oh, just like in general over the years.
Joanna: [00:55:26] Yeah.
Patrick (CEO of WSO): [00:55:28] Usually there's some really great threads in terms of like there was a question on like how to best prepare for professional life, as much as like I said about like getting good at talking and all this stuff. There are some things that would be good to review based on like just work products and being professional. I've heard from some people like kids coming out of Covid and associates like they just don't even know how to act in a professional work environment because they were like cooped up for two years. So like just reading some of those things is just like professional etiquette of like. Okay when you go to a workplace dinner it's not a time to get wasted. It's not a time to be like inappropriate and all that stuff. So like there's some people like just don't control them. They have trouble controlling themselves. So think things like that. But then also just like habits in the workplace. There was a thread. I don't know where it is, but there's a thread specifically around how to be like a top analyst and there's like a lot of little annoying things in that or things that you think are so silly that the top analysts do consistently and associates and a lot of it's like printing out your before you hand in or send in a model you actually print it out and you use a highlighter and just look it with like look at it on an actual printout rather than just on the screen.
Patrick (CEO of WSO): [00:56:44] You'll be shocked like you'll print it out. You'll be like It's good I'm done, you'll print it, take a look and be like. Oh my gosh, wait what did I mess up in that cell? Oh, that. That doesn't make any sense. Then you go back, you fix your. Okay, I'm done. Print it again. You look at it again. Wait, What the hell? Oh, my gosh. Okay, let me go back again. Versus sending it right versus trying to rush and send it. Like there's those little things that can really help you when you get a turn from somebody from an associate VP same thing. You get a higher you mark Every time you do one, you mark it off because then you have a literally a page of scribbles of like things that are hard to read. What have you done? What haven't you done? If you try to just like go do it randomly, you're going to miss like a third of the edits. So little things like that. Like little tricks, I think help just make a better impression in that first or second month. You don't want it to be like learning those little tricks like by month 3 or 4 because then. You may leave, kind of, it may make you look sloppier when you're not sloppy. You're just didn't have that like those little tricks that some other people had.
Joanna: [00:57:49] Yeah, that makes sense. I mean printing some of my study sheets out works for me instead of just like scrolling through my laptop trying to study for tests.
Patrick (CEO of WSO): [00:57:56] It's hard.
Joanna: [00:57:58] It's pretty similar.
Patrick (CEO of WSO): [00:57:59] You miss so many things. You don't think you miss it. You think it all looks good and then you print it and you're like. Whoa, like this doesn't make any sense. Or like, if you hand in something like to an associate or a VP and it's like the multiples are like you're looking at like trading multiples. It's like, it's so something like 625 times like earnings and everything else is at like ten times earnings or six times earnings. And they're like What is this? You know what I mean it’s like you better be ready to answer that question or like anticipate that. And so I think good analysts will like look over their work product and be like. This doesn't make sense and step back. It's so easy to say but it's actually really hard to do when you're running like fast. It's like just step back or you're like well there's people screaming at me to like send this in and like, do you know what I mean? So it's easy to say but it's actually really hard in practice to get to done.
Joanna: [00:58:49] Yeah, it makes sense. I'll make sure to go ahead and look for that thread actually. It sounds like…
Patrick (CEO of WSO): [00:58:52] Yeah, I'll look it like there's probably a bunch like what makes the best like investment analysis or like tips for investment banking analysts to be the you know, what my best analysts do. There's you can search on like those types of queries and it'll probably pull up a bunch. And if you look at like the ones that are highest ranked, that's usually people are like really agreeing with. That's probably there's a reason for that.
Joanna: [00:59:16] Got it. Thank you! Patrick.
Patrick (CEO of WSO): [00:59:16] Yeah, no worries.
Margaux: [00:59:20] Well, think that we're going to bed up to finish it. Thank you very much for coming along for stories and tips and advice! So forward to having you again.
Patrick (CEO of WSO): [00:59:35] Yeah, Thanks everybody! For having me. Good luck with everything. Remember not to stress out. I know it's a super stressful time for all of you with midterms and recruiting and all this stuff, so just try to keep good perspective. Obviously, you got to work hard but yeah, just try to breathe. You guys are very, you guys are in a pressure cooker school so like I know how it is for undergrads. It's a lot harder than the MBAs but like remember how it was. So just remember that like you're all in good shape. And it's a long journey. It's not like what happens in this next few months isn't like going to define you for your career. So just keep that longer term perspective and you'll be fine.
Margaux: [01:00:13] Thank you!
Patrick (CEO of WSO): [01:00:15] Thanks, everybody! Appreciate your time. Bye, everybody. And thanks to you, my listeners at Wall Street Oasis. If you have any suggestions whatsoever, please don't hesitate to send them my way. Patrick@wallstreetoasis.com and till next time.
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