Interview with a manager in financial valuation
Financial valuation is a crucial aspect of corporate finance. This challenging and demanding profession is more discreet compared to other transactional professions such as Transaction Services or M&A, but it still plays a significant role in any financial operation.
We spoke to Tristan Rabatel, a Manager in Financial Valuation at EY, to learn more about the profession, its challenges, and the career prospects it offers. In this article, Tristan shares his daily routine and offers advice on working in valuation and financial modeling.
Can you give us a brief overview of your background?
After high school, I pursued a general university degree, including economics, mathematics, and law. I was also able to continue playing rugby as a high-level athlete.
I then went on to complete the Master in Financial Engineering and Transaction at the IAE of Lyon. While studying, I had two internships in financial auditing that gave me a strong foundation in accounting and financial analysis. Besides, I interned in the company valuation team at EY and was eventually offered a permanent contract with the same team.
I’ve now been with EY in Lyon for nearly 7 years, and I hold the position of Manager, focusing on business and asset valuations.
Can you explain the role of a financial valuation consultant?
Financial valuation consultants are responsible for estimating and justifying the value of assets, typically companies or groups of companies, in various contexts.
Some examples of these contexts include:
- Merger and Acquisition (M&A) transactions, where the goal is to estimate a valuation range that is consistent with the intended acquisition scenarios. Financial valuation consultants may be involved early on, before a letter of intent is signed, or during the due diligence phase.
- Strategic decision-making, where the objective is to help clients raise funds, renegotiate debt, or reorganize their capital. Financial valuation consultants must have strong expertise in financial modeling to develop flexible models for scenario analysis, business planning, and debt repayment.
- Fair value opinions for regulatory purposes, where financial valuation consultants act as independent experts to provide assurance to third parties on the value of companies, businesses, assets, or complex instruments. This helps build trust among stakeholders such as boards of directors, investors, regulators, tax authorities, auditors, employees, and others.
The common factor in all these situations is the transaction. We can provide support in pre-transaction valuation as well as post-transaction valuation. The role of a financial appraiser is thus very dynamic with a lot of opportunities for growth.
What would you say are your typical responsibilities as a Manager in Financial Valuation?
As a Manager, my responsibilities are diverse and include:
- Supervising teams working on the same projects as me,
- Conducting client meetings,
- Ensuring that projects are completed on time and to the highest quality.
- I also dedicate time to business development, training, recruitment, and other transversal functions.
Working in a multidisciplinary firm like EY also involves collaborating with people from other professions, such as lawyers, transaction specialists, financial auditors, and accounting and financial consultants, which adds to the richness of the profession.
How would you describe the workload in financial valuation? Are the work hours as dense as in M&A?
The workload in financial valuation is quite different from that in M&A. While a certain level of commitment is required for any job that involves strategic and financial issues, the days in financial valuation are busy but do not typically involve late nights or weekends. There is a good balance between work and leisure. Leisure activities are even encouraged within the teams.
Many students and junior professionals often confuse financial valuation with transaction services. Can you explain the difference between these two professions?
Financial valuation focuses on the objective determination and justification of the value of an asset or company. It requires strong problem-solving skills and a deep understanding of the business model, risks, and challenges in each situation.
On the other hand, Transaction Services conducts a company diagnosis. Its aim is to analyze the company’s historical performance, assets, and liabilities, and to provide insights for price negotiations. This work demands strong analytical abilities and expertise in accounting and finance. It primarily focuses on understanding a company’s past performance.
The situations in which these professions are involved are also distinct. In most cases, Transaction Services is involved in the heart of a transaction and prior to negotiations. Financial valuation, on the other hand, can be involved in a wide range of circumstances, such as very early in a transaction or even after an acquisition has taken place.
Check our article on Transaction Services, Valuation and restructuring processes.
Do you think that financial valuation is an interesting and sought-after first experience for a corporate finance student? If so can you tell us why?
Financial valuation is an interesting and enriching first experience for corporate finance students because of the wide range of contexts in which the work is done and the variety of technical skills that need to be applied. The job also provides young consultants with early exposure to situations that can help them develop their client relationship and team management skills. These skills can lead to other finance careers such as Private Equity, M&A, Transaction Services, structured finance in Investment Banking, etc.
What are the responsibilities of a financial valuation intern?
The financial valuation intern participates in the same missions as a young consultant on a permanent contract, but with more supervision. As a financial valuation intern, you will be involved in validating the accuracy of valuation models and analyzing market data. Additionally, you will also be involved in client interactions and be responsible for contributing to the writing of the final deliverables.
Through this hands-on experience, you will gain valuable skills such as the ability to synthesize information, maintain a high level of rigor, and develop your financial modeling and valuation skills.
What is the typical profile or resume for working in valuation? Is a top university degree essential?
To work in valuation, a strong background in corporate finance and prior experience in analytical and consulting roles is highly valued. This could include internships in areas such as transaction services, audit, mergers and acquisitions, strategy consulting, or financial controlling.
Additionally, having international experience and proficiency in English is a significant advantage, as many clients may have international considerations. While a top university degree can be beneficial, it is not a requirement as long as the candidate has a solid understanding of corporate finance and relevant experiences.
Finally, would you have any advice on how to prepare for financial valuation interviews?
Financial valuation requires strong technical and theoretical knowledge. It is crucial to have a strong understanding of the fundamentals of corporate finance, including concepts such as financial modeling, WC, economic balance sheet, and cash flow calculation. Of course, you should also be familiar with financial valuation methods.
Additionally, it’s crucial to be able to articulate your motivations for pursuing this role and to show that you understand the responsibilities and challenges associated with the job. Being knowledgeable and confident in these areas will help you make a strong impression during the interview.
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Interview conducted by Florian Tupinier