3 The preeminent program that built on the investment philosophy Warren Buffett was taught when he was a Columbia student. Once admitted to the business school, interested students had to apply for admittance in the value-investing program, a process more rigorous than the business school admittance process itself.
4 Small trophies bankers have manufactured following a deal closing—trophies they give themselves. We’ll get to them later.
5 A chart, wildly susceptible to quantitative manipulation, which shows how much greater Bank X is relative to other banks.
6 The original premise behind hedge funds was to hedge their investments so the fund would perform well regardless of market conditions. However, as investment strategies have become more aggressive, many hedge funds no longer use hedging techniques to protect against downturns.
7 As do how funds make most of their money. Historically, collecting a percentage of their outperformance accounted for the brunt of the money hedge funds made. More recently, as funds’ assets under management (AUM) have grown, taking a yearly management fee accounts for a larger chunk of earnings for more established firms that can rely on past performance to attract new investors’ capital.
8 There’s another group called “capital markets” (both equity capital markets and debt capital markets) that is somewhere between the sales and trading and corporate finance divisions. The capital markets teams constantly evaluate the market and help the corporate finance team execute deals at the most opportunistic time. Given that they are on the private side, I’m considering them a part of the corporate finance division.
9 In the research world, the term “analyst” refers to the most senior person. This should not be confused with the corporate finance analyst, which is an entry-level position for individuals right out of college.
10 This involves having selected A1 (the “home” cell) in Excel when you save a document so when it is re-opened, the document will open here rather than to another random cell.
11 Would’ve been even par if the caddy hadn’t clubbed him wrong on last two holes, resulting in back-to-back three putts.
12 An outdoor excursion where, at some point, you’ll find yourself wearing an oversized helmet crookedly on your head, multiple belts crisscrossing your crotch, and yelling “Belay on!” while flashing a thumbs-up.
13 The charges against Jesse Litvak were ultimately dropped.
14 According to their website, Moody’s Analytics Knowledge Services (MAKS) is a “leading provider of high-value research, analytics and business intelligence to the financial services sector.” In practice, they are a service based in India that many banks use to outsource work and thus are treated as one rung below analysts. Like the other services that DB outsources, MAKS is paid a yearly flat fee.
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16 Bulge-bracket investment banks (Bank of America, JP Morgan, Deutsche Bank, and so forth) have a balance sheet, which allows them to lend to borrowers. Boutique investment banks (Lazard, Moelis, Evercore, and others) only provide advisory services.
17 A summary output of all valuation methods used. The name is derived from the fact the output resembles a football field—or at least what bankers think a football field looks like. I don’t see it.
18 And footnote the fuck out of it.
19 Footnoted this fucker too.
20 One of the few times a junior banker can use his mouse without being lambasted by his peers.
21 You put [TBU] (to be updated) text boxes on pages so others working on the deck know which pages are incomplete. These can be tricky, though. You can put [TBU] on a page, meaning it’s someone else’s problem, and five hours later, that someone is you.
22 Earnings before interest, tax, depreciation, and amortization (EBITDA) is calculated by taking the company’s net-earnings figure found on the income statement, then adding back interest, tax, depreciation and amortization, which are found on the income statement and the cash-flow statement.
23 Not to mention the logistics of quitting—there’s more paperwork to fill out when you quit than when you join.
24 To be clear, these synergies will never be realized.
25 As of the date of this book’s publication, the company in question has not hit its projections.
26 I’d
27 That's one billion dollars of uncertainty based on Barry's industry expertise.
28 Goldman’s analyst notifies us that the Goldman logo on vFFFFFF5 is three millimeters smaller than the DB logo. We adjust accordingly.