Does anyone have any recommendations for resources for advanced excel modeling skills in NYC? I’ve heard of DealMaven, Training the Street, Wall Street Institute, Wall Street Prep, NYSSA Financial Analysis series, etc. but don’t really have any insight into the quality of these programs. Basically, I’m a CPA and have completed all three levels of the CFA exam and have accrued accepted work experience from CFAI (looking forward to receiving “the notice” from Jeff D!) so I’m not looking for any accounting review or basic valuation methodology review and I feel very comfortable with excel. I’d really like to find a program that is going to go through a comprehensive M&A model and LBO model at an advanced level, including synergy modeling, cash sweep, accretion/dilution, realistic comparable company and transaction analysis, PIK debt, mezzanine financing, etc. that’s at the level of rigor of a practitioner. I may be looking for something non-existent outside of actual on the job experience, but if anyone has any recommendations I’d appreciate it.
What does any of that have to do with Excel? Excel is a totally feeble modelling tool (unless you can program in VB, in which case it is a fine modelling tool with a piece of crap front end).
soma80 email me at aol. I took some of those classes and can you give you insight into my exp. But keep i mind they are 1-2 day classes. You forgot 70% of what they teach. Reading a textbook on financial modeling or in-house training might be best
I think one of the largest pains in modeling is figuring out other people’s models, since there is absolutely no regularity in this field. Good practice for this is just reading lots of models. I haven’t seen a course that throws a lot of different modeling styles at you, and the only sure thing in this business is the next model you inherit won’t look like any of the previous ones. You could do worse than wade through damodaran.com’s models, which at least do things in a defensible way, even if they’re generally more academically slanted than what you would encounter in a real firm. Apart from that, speed is gained by watching an excel wizard work and figuring out the shortcuts.
Joey- I added the excel point because many of the offerings I’ve seen (particularly the NYSSA courses) mention some working knowledge of excel as a prerequisite. From your post, I’m assuming that you are comfortable with VBA programming. What process did you go through to learn VBA? I have experience in writing simple macros in VBA for simple custom functions or formats but certainly nothing that deep. Within the context of M&A and LBO modeling, where have you run into limitations with excel?
I’ve never done in M&A or LBO modelling. However, in general the problem with “modelling” in Excel is that Excel has very limited tools for dealing with randomness, optionality, or simulations. I suppose that what you are calling modelling amounts to making pro-forma statements under different financing possibilities and that kind of thing and I suppose that Excel is fine for that. The problem is that all of these models suck because they are just about expectations (and all kinds of theorems about expectations that aren’t true incidentally - like the one that says E(a^X) = a^E(X) which is in all of these models) and not about variability or fuzzy information. So you make a model in Excel and I make a model in Excel and they are different. We don’t know why except in this broad kind of way that my inputs were different from yours. What good could these models possibly be for anything? (Well, highly paid MBA’s who got above a 75% on an eighth grade math test did them so they must be worth something).
Oh I learned VBA just by having a buddy sit down with me for a couple of hours and give me a start (show me how to start it, write some simple code, etc) and then the Internet has tons and tons of VBA code. If you want to know how to do the most esoteric thing that really shouldn’t be done in VBA (someone has probably written a device driver in VBA for example) you can find it on the Internet somewhere. (It’s probably not possible to write a device driver in VBA)
Three words for you, JoeyD: “Crystal Ball Add-in” (I’m just being facetious, don’t flame me) Point taken regarding what I’ll call risk management in excel modeling. Using the CHOOSE function for base case, best case, management case isn’t exactly the most robust analysis of potential outcomes. That being said, few people have the mathmatical firepower to really understand and accurately model stochastic processes or whatever other hot buzzwords are out there that 99.9+% (myself included) of posters on AF don’t truly understand, I’m just trying to get the best picture of the kinds of models the highly paid MBA’s use in practice. Let’s go Mountain Hawks!!
Try www.euromoneytraining.com. I went to one of their NYC sessions once, taught by an Stern School prof and colleauge of Damodoran (sp?) and was quite impressed.
soma80 Wrote: ------------------------------------------------------- > comfortable with excel. I’d really like to find a > program that is going to go through a > comprehensive M&A model and LBO model at an > advanced level, including synergy modeling, cash > sweep, accretion/dilution, realistic comparable > company and transaction analysis, PIK debt, > mezzanine financing, etc. that’s at the level of > rigor of a practitioner. > I can’t help with recommendations in NYC, but if you think about and correctly structure the cash cascade of your model, modelling cash sweeps, mezz debt, numerous tranches of debt and multiple cash reserves is a breeze. Most people don’t do this and end up in a mess. Otherwise, I agree with DarienHacker.
Oh, and I think Excel is great, but I supposed it depends on what you’re using it for.
JoeyDVivre Wrote: ------------------------------------------------------- > However, in general the problem with “modelling” > in Excel is that Excel has very limited tools for > dealing with randomness, optionality, or > simulations. I’ve been able to do quite a bit of simulation and Monte Carlo pricing in excel, mostly without VBA. Plenty of optionality (of any type you can name) to boot. As you say you need to do some tool building, but Excel’s never purported to have as a strength libraries of canned solutions. > > The problem is that all of these models suck speak for yourself > because they are just about expectations (and all > kinds of theorems about expectations that aren’t > true incidentally - like the one that says E(a^X) > = a^E(X) which is in all of these models) and not > about variability or fuzzy information. Not sure what you mean by variability or fuzziness, or the point in general. > So you make a model in Excel and I make a model in > Excel and they are different. We don’t know why > except in this broad kind of way that my inputs > were different from yours. What good could these > models possibly be for anything? True of any computer programming really. On average I’ve found Excel no easier or harder to read than other formal languages. What do you propose as an alternative – Matlab? C++? It’s possible to write great code or cryptic garbage in any language. (Well, great code in Basic would be a challenge admittedly.) > (Well, highly > paid MBA’s who got above a 75% on an eighth grade > math test did them so they must be worth > something). Hey, I resemble that remark. > “Crystal Ball Add-in” (I’m just being facetious, don’t flame me) Just because JDV won’t doesn’t mean I can’t. 
CB is a useful educational tool but can’t be used for many serious applications because, last I knew, it can’t generated values for correlated random variables. And I don’t even know whether you can code a random process in it. Excel’s strengths are GUI tie ins and a built-in data dependency graph. It’s not the world’s best simulation language and we all know VBA’s limitations, but no language is perfect. For better or worse it’s lingua franca in IB and I’ve see too many projects waste millions of dollars and thousands of lives trying to displace it. Until something better comes along I’m afraid we’re stuck with it, warts and all. (Kind of like this qwerty keyboard I’m using; and democracy.)