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Hey, future bankers!

Hope everyone is doing well! Today we’re covering two revenue build approaches and what motivates you to do your best work.

🚀 Let’s get into it.

🔢 Technical Question

What are the pros and cons to top-down and bottoms-up revenue model builds?

Let’s delve into the pros and cons of both top-down and bottom-up revenue model approaches:

1. Top-Down Revenue Model:

   • Advantages:

     • Reduced Variability: Top-down forecasting avoids statistical outliers common in lower-level data. It provides a broader picture of revenue potential, helping identify sales patterns and allocate resources effectively.

     • Faster Results: Companies using top-down forecasts don’t need real-time point-of-sale data. This approach evaluates market trends and long-term profit potential.

   • Disadvantages:

     • Less Accurate: Top-down forecasting lacks department-level involvement, potentially leading to less accurate predictions.

2. Bottom-Up Revenue Model:

   • Advantages:

     • More Realistic: Bottom-up forecasting offers a more realistic financial view. It projects revenue by multiplying average value per sale by prospective sales per product.

     • Detailed Insights: Examining factors like production capacity, department-specific expenses, and addressable market leads to a more accurate sales projection.

   • Disadvantages:

     • Time-Consuming: Bottom-up forecasting involves detailed assessments and can be time-intensive.

     • Complexity: Managing individual product or service projections requires granularity and attention to detail.

Overall, top-down provides a high-level perspective, while bottom-up focuses on individual components.

🗣 Behavioral Question

What motivates you to do your best work?

Here are a couple of best practices for responding:

1. Highlight a Growth Mindset and Alignment with Industry Values:

• Focus on learning and development: Investment banking is a fast-paced and demanding industry. Show the interviewer you're eager to learn and contribute. You could say something like: "I'm highly motivated by learning new things and expanding my knowledge base. In an internship, I'd be excited to learn from experienced professionals and gain a deeper understanding of the financial markets."

• Connect your motivation to industry values: Investment banking emphasizes diligence, accuracy, and a drive for results. Briefly mention how your motivations align with these values. For example: "I'm intrinsically motivated by delivering high-quality work. The fast-paced environment of investment banking, where precision and results matter, is something that really excites me."

2. Use the STAR Method (Situation, Task, Action, Result) with a Specific Example:

• Go beyond generalities: Don't just say you're "motivated by a challenge." Provide a specific example to illustrate your point. You can use the STAR method to structure your answer:

  • Situation: Briefly describe a situation where you had to push yourself. This could be a school project, a personal challenge, or a previous internship.

  • Task: Explain what you specifically had to accomplish.

  • Action: Detail the steps you took to overcome the challenge and deliver results.

  • Result: Highlight the positive outcome and how it demonstrates your motivation.

Thanks for tuning in today! Best of luck to everyone working through recruiting right now. If you sign an offer, reply to this email and let us know about it! Like seriously, do it—we’d love to hear about it!